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1. You are becoming addicted to World of Cowcraft, a popular MMORPG. After playing for a few hours, you estimate that in the next hour, you can produce 100 WoC gold. Due to your increasing skill level, you estimate that every hour thereafter your gold output will increase by 5.1% relative to the previous hour. If these estimates hold up, how much WoC gold in total can you mine in the next 50 hours of play (cumulatively for all 50 hours)? Will you ever get those hours of your life back?

2. Dvorak Enterprises is expected to pay a stable dividend of $6 per share per year for the next 8 years. After that, investors anticipate that the dividends will grow at a constant rate of 2 percent per year indefinitely. If the required rate of return on this stock is 11 percent, what is the fair market value of a share of Dvorak?

Financial Management, Finance

  • Category:- Financial Management
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