Is Part A as simple as accepting the individual projects with an expected return greater than 15%?

For Part B, would you use the Expected Stock Return formula and accept projects greater than 15%? For example, project #1, r = 8 + 0.5(7) = 11.5%, so do not accept this project? For project #2, 8+0.8(7) = 13.6, don't accept?

 

If you have taken/studied for Course FM, this will be easier to understand.  The equation written by jen11 on 6/20/2005 (see her post previously) is gotten in the same manner you would get the PV of a bond for Course FM.  The payments of 480,000 come from "Fr" in the bond equation, or (6,000,000*.08), and the 6,000,000 is equal to "c" in the bond equation, or the face value.  The PV of a bond = Fr a angle n + cv^n with n = 7 and interest rate 10%.  Hope this helps some!