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FM BPP-kit P252 Q6

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › FM BPP-kit P252 Q6

  • This topic has 3 replies, 2 voices, and was last updated 3 years ago by John Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • September 2, 2021 at 4:15 am #633900
    YujiaLucy
    Member
    • Topics: 26
    • Replies: 27
    • ☆☆

    I chosed the third answer and don’t understand why it should be the first one. The standard answer doesn’t explain it much, could you please explain it for me? I truly apologise if this is a stupid question but please help me!

    September 2, 2021 at 8:05 am #633930
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54704
    • ☆☆☆☆☆

    With higher risk the investors require a higher return.

    The higher the required return then the lower will be the market value.

    September 3, 2021 at 4:44 pm #634172
    YujiaLucy
    Member
    • Topics: 26
    • Replies: 27
    • ☆☆

    Oh right! and the market value (of the irredeemable security paying a fixes rate of interest) here shoud (= Interest/asked rate of return) right? just to make sure!

    September 3, 2021 at 5:01 pm #634183
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54704
    • ☆☆☆☆☆

    Correct.

  • Author
    Posts
Viewing 4 posts - 1 through 4 (of 4 total)
  • The topic ‘FM BPP-kit P252 Q6’ is closed to new replies.

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