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1.Sally Prescott plans on retiring in 15 years, that is, she will work for another 15 full years. When she retires she plans on spending 3 years in Bulgaria volunteering for the Peace Corps. After which she will spend her time in Boca Raton, Florida at a townhouse she purchased 5 years ago for $250,000. She currently has $100,000 in savings. She estimates that she will need $20,000 a year for living expenses in Bulgaria and then $35,000 a year for approximately 20 years when she retires to Florida. If she earns 4% compounded monthly in her savings account, how much must she deposit each year to meet her financial goals? She will withdraw her annual cash flows at the beginning of each year, that is, her first $20,000 withdrawal will occur at the beginning of year 16, before she travels to Bulgaria. Her annual deposits will begin at the end of this year and continue until she leaves for Bulgaria.

2., Matt Shorted 200 shares of pirate stock at $20 per share at an initial margin of 80 percent in his new account; the stock has since increased and closed at $25 per share today. Assuming matt has no other positions and has added no other cash, how much cash does he have.

3.A. When is the best time to exercise the call option and put option strategy? Justify.
B. What is risk-neutral valuation? Expound.

4.Bate industries has a quick ratio of 1.3, net profit margin of 6%, inventory turnover of 2.8, total asset turnover of 1.5, accounts turnover of 2.2, a debt to equity ratio of 1.1 and its PE ratio if 18. Compute ROE