[nidhijain]

I used the three theories behind the normal yield curve shape (Liquidiy, expection and market segmentation) to answer the question about differences in interest rates between short-term and long-term securities. But with M&M theiry in cap structure I don’t know why I wrote about business risk financial risk and project specific cost. Silly me!

[nidhijain]

Can someone please tell me if the reasons for rise interest rates on bonds are liquidity, expectation and market segmentation theories? Also reasons for change on Wacc with in cap structure business, financial and project specific cost of cap?

[nidhijain]

47 percent 2nd attemot. Didn’t think that I would fail. Not having much luck with acca in general. Seem to be re- sitting lsdt few papers in level 2. At this rate I would age and still be sitting these exams!!!

[nidhijain]

<cite> @greggie said:</cite>
Id say you only get 1 mark for introducing tax to bank debt. So thats all youd have lost. Chin up.

And that’s if im right of course. And many many people tell me I never am.

No point in panicking now. Let’s wait for the proper answers. Then we can all panik 🙂

True…Yup. we have to now just wait :). 2nd attempt for me so desparate to pass this time lol..

[nidhijain]

In that case I will lose a couple of marks as i just took 4%..

[nidhijain]

<cite> @icedawn said:</cite>
btw for the bank , were we supposed to use the after tax interest or just the 4 %?

I just took 4% as they are bank loans..all fixed and preagreed. Hope I am right..

[nidhijain]

<cite>@leogr said:</cite>
how did you get IRR 4.7% with 10 and 5% D;
5+NPV1/NPV2x(10-5) should give us certainly higher of 5% ;;

(104.5) MV
4.9 Int 1-6 yrs
105 RV 6 yrs

Got IRR of 4.7%
not sure why I had both NPVs as -ve.. just couldn’t get the 5% as +ve.

[nidhijain]

<cite><a href=”https://opentuition.com/members/Lambyang/" rel="nofollow">@Lambyang said:</cite>
1st question wacc 11.6%…am i right?

I got wacc as 10% incl bank loan…not sure if thats correct. IRR 4.7% aaplied 5 & 10% both came up as -ve bals….

[nidhijain]

Hi
I had reappeared in Dec’11 and got 46% :(….. very disappointed!!

[Author]

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