[fazeel93]

My answer for first part is : that interest parity the theory says that the currency rate changes in different countries so that the interest rates becomes equal so that one would get no benefit from transferring his money from one country to another so acording to interest parity theory after 1 year the exchange rate would be such that the interest rate become equall so therefore it should remain unchanged,

But whats the answer of second part ? Which alternative will generate the highest expected amount of dollars? If multiple alternatives are tied for generating the highest expected amount of dollars, list each of them.

[fazeel93]

Sir this was in our test in class for p4, i am not aware of which book but i would reallly appreciate an answer for this as you have vast knowledge of it, if u could give smal answer for this

Basically in the above scenario just this i want answer of, Which alternative will generate the highest expected amount of dollars? If multiple alternatives are tied for generating the highest expected amount of dollars, list each of them.

[fazeel93]

Like sir in this question im getting a positive npv of 951,000 dollars however he can have the alternative of getting cash 1.5million dollars straight away right now so obviously cash is better right?

[fazeel93]

One more thing sir that i this question retained earning figure is given of one yr and the project is a new developmental project , what is the significance of retained earning figure? are we supposed to use cost retained earnings figure in WACC?

[fazeel93]

and sir what if a country sells a stake of a stock exchange, and they say that its currently owned by like 500 brokers, who might look to sell 40 percent stake ?
thanks alot btw

[fazeel93]

So every country has difference in starting base? Amd whats basically the starting base?

[fazeel93]

And must thank u sir for your replies

[fazeel93]

Thanks a bunch it clarified alot of things so its basically used to make a profit,
What about selling the put option just like we can sell a call option, is that possible too?
And is there any difference between currency options and share options apart from the underlying item?

[fazeel93]

And sir these options are for companies shares , so are they traded in stock market just like shar es ? And options used for example in hedging for currency are traded there along side?

[fazeel93]

ok thanks alot

[fazeel93]

i get that sir but basically what i want to ask you to clear my concept of effective rate is that, does the effective rate basically incorporate the basic finance charge + a charge to increase the value of loan if it will be paid at a premium? is that a fair point ?

[fazeel93]

thanks sirrr

[fazeel93]

for sure sir, thanks alotttt

[fazeel93]

so due diligence and forensic may naturally stray away from analytical and enquiry due to its nature,

Thanks sir!

[fazeel93]

what i meant was like sir an announcement that this company is taking over and all major stakeholders are aware of it

[fazeel93]

Oh ok thanks sir i got it i had a similar question too

[fazeel93]

Oh ok thanks sir what a relief

[fazeel93]

Oh right but sir what is that “agency effects on capital structures ” thats given in books and notes im reading of lsbf

Thanks alot

[fazeel93]

Thanks sir

[fazeel93]

and how much of it is similar to f9 and how much is brand new ?

[fazeel93]

right ok, i found f9 to be fun and much better than other papers, do u think its a viable option to go for p7 and p4 in december ,

[fazeel93]

Thank You for your speedy reply. Yes I understand what you mentioned but I just wanted to know that is this method of discounting the cash flows using the coupon rate utilized for assets as well,

[fazeel93]

Thanks Sir Ken, so i get what strategic direction is but how can strategies me broadly categorized in p3, is it fair to divide them in development,competitive and growth strategies? and naturally different models for each for example for competitve there are porter generic and for growth their is ansoff

[fazeel93]

What abt profit from discontinued operations should that be included in net profit?

[fazeel93]

No but sir the finance lease obligation would be there in balance sheet, and you said naturally and interest + depreciation expense is there in SOPL , and capital employed understated , why would a company want to treat the lease as a finance lease in this case, I understand why they would want to switch to an operating lease from a finance lease but not vice versa

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