[Fabian]

Hi. Pls add me too. 0169260501

[Fabian]

For Q1, got a loss before tax for all 4 years, anyone else the same?
Agreed Pa=Pe as well for BSM.

For Q2, all 3 companies have market capitalization exceeding the amount calculated by Dividend Valuation model, anyone else the same? Didn’t know how to explain too.

[Fabian]

Dear John,

In the BPP studytext, Practice Answer Bank, for the question of Canadian Inc:

There is a debt beta of 0.25. And the Kd is obtained using CAPM
ie KD= 8% + (16% – 8%) 0.25= 10%.

I thought the CAPM can only be used to calculate Ke? Hoping you could clarify. Thx

[Author]

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