[ritik]

got it sir thank you so much. i saw your lecture video

[ritik]

leave it sir i got it anyways thank you . sir can you tell in overtrading will the receivable , payable and inventory increase or decrease???

[ritik]

Copper Co is concerned about the risk associated with a proposed investment and is looking for ways to incorporate risk
into its investment appraisal process. The company has heard that probability analysis may be useful in this respect
and so the following information relating to the proposed investment has been prepared:
Year 1 Year 2
Cash flow Probability Cash flow Probability
($) ($)
1,000,000 0·1 2,000,000 0·3
2,000,000 0·5 3,000,000 0·6
3,000,000 0·4 5,000,000 0·1
However, the company is not sure how to interpret the results of an investment appraisal based on probability analysis.
The proposed investment will cost $3·5m, payable in full at the start of the first year of operation. Copper Co uses a
discount rate of 12% in investment appraisal.
Required:
(a) Using a joint probability table:
(i) Calculate the mean (expected) NPV of the proposed investment; (8 marks)
(ii) Calculate the probability of the investment having a negative NPV; (1 mark)
(iii) Calculate the NPV of the most likely outcome; (1 mark)
(iv) Comment on the financial acceptability of the proposed investment

sir this a very recent question please help me. thank you

[ritik]

country X’s interest by IRPT = spot now X interest abroad/interest home.
not the fisher formula, that is related to inflation, real discount rate and nominal.

and yes ROCE = operating profit – (total deprecation / number of year )/ (capex+scrap/2)

i honestly did not do sep16 cbe however i prefer you to do the latest one.

[ritik]

the ans is 0.22 there wasnt any explanation for it

[Author]

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