Question1. An investment costs $3,000 at present and provides cash flows at the end of each year for 20 years. The investment's expected return is 10%. The projected cash flows for years 1, 2, 3 are $100, $200, and $300 respectively. Determine the annual cash flow received for each of the years 4 through 20 (17 years)? (Suppose the same payment for each of these years.]

Question2. A financial analyst has been following Johns Inc., a new high-growth company. She estimates that the current risk free rate is 6.25 percent, the market risk premium is 5%, and that John's beta is 1.75. The current earnings per share is $2.50. The company has a 40 percent payout ratio. The analyst estimates that the company's dividend will grow at a rate of 25% this year, 20% next year, and 15 percent the following year. After three years the dividend is expected to grow at a constant rate of 7% a year. The company is expected to maintain its current payout ratio. The analyst believes that the stock is fairly priced. What is the current price of the stock?