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Hello, Can anyone assist in the below. I am inputting the figures in the excel sheet and I got $45000. how does this relates to the regression part?
passed with 61. this was my third attempt. thank god and ot i pass. so hated this paper. definitely not doing p4
@curiousmeerkat said:
Is that the one where one party provides the money and the other only the expertise?yes
@aneelraja said:
hello again,
i do understand the the rest, but to calculate the spread u need variance of cash flow, transaction costs and interest rate . And either i was stupid or i was confused but i didnt saw these figures any where in the question.
And i am more confused because it was an easy Q (if i had the figures).hey the spread was given so we didnt had to calculate it. the spread given was 75000
@ammar-shabbir said:
Hello Everyone i just want to comment regarding Q.1 for the calculation of npv i used after tax rate of 7 % the reason being that in WACC there r 2 components Ke & Kd in case of Ke there is no tax but in Case of Kd it is tax deductible thus for npv calculation i took 7 % rate after tax…. however in part b asset replacement Qs…
i used 12% the reason being that it explicitly stated that ignore tax & capital allowance….thus i used 12 % before tax so do comment whether it was logical or not….. thanks…..
In Q4 i did make a blunder i took year 3 dividend value & use that in dvm formula & got an utterly ocnfusing figure 1444444… something like that…. but hoefully i might get 2.5/4 as i correctly calculated Ke…..for the dvm i got 11444 million. i took yr three since the question mentioned the company was struggling financially for the last two yrs
@olaf said:
For question 1 I disregarded fixed costs as there was nothing mentioned about them that they are additional (incremental) fixed costs.
I was wondering about that but all the practise questions I did there was clearly mentioned about FC. Here they seemed to me irrelevant.
Anyway at the end of the day it’s probably 1/2 mark for including them, I stated the comment why I didn’t take them into account….the question did mention it was related to the operation
@angusyiu said:
the difference for mine is more than that. By the way, did you guys divided the annual borrow rate/deposit rate to get 6 mth rate for your calculation?? I think we have to?hey yes u had to divided
the rate. the rates given were for the entire year@imtired
I got $251256 for forward. The difference for mine was $2400+ btw the 2 answersi got the same thing. the best option was the forward exchange rate since it offers a higher receipt
