[Yu Huey]

Alright. Thanks for your explanation and advise. I am going to watch the free lectures now. thanks =)

[Yu Huey]

Ok. I got it. Thank you! =)

[Yu Huey]

Thanks Mr John. Btw. How to get the $0.40? is cost of capital same as required return by the capital provider?

[Yu Huey]

ex-dividend market share price = $5.20 – $0.60 = $4.60

Cost of Capital = $0.45/$4.60 = 0.0978 or 9.78%

[Yu Huey]

Is (B) the correct answer?

US/Euro spot rate is $1.412 per Euro
thus, $1.412 X (1+0.05)/(1+0.02) = $1.4535 per Euro

$1.4535 X Euro 5m = $7267647

[Yu Huey]

Q19)
year 1-5 Interest (8% x 100) = $8
df @ 12% 3.605
3.605 x $8=$28.84

year 5 RV (110% x 100) = $110
df @ 12% 0.567
0.567 x $110=$62.37

P0 = ($28.84+$62.37) x ($400000/$100) = $364840

[Author]

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