[zanawi]

79, second attempt. Thanks God!!! Thanks open tuition!!!

[zanawi]

you are correct

[zanawi]

I got:
a NPV of 3947.26 for Q1-a, NPV of 4029.63 for Q1-b(i made error here). Ke=12.66 Q2-a( i made a mistake here too),Kd=5.17, WACC 11.434, CAPM 8.21% equity finance only,7.98% taking the effect of debt. Q3-a. 5,454. b) 3987(i made a mistake here too i think it should be 4002). Excess discount benefit to using longer payment period 2,686. Q4. under purchase cost=778,525. under lease option cost=679,985.

[zanawi]

I think the trick is when you calculate the real rate of return.

[zanawi]

I got a different NPV under a and b. i think i made a mistake when I calculate the rear rate of return. I took a nominal rate of 12% rather than 17%. accordingly i arrived at rear rate of 7% but the correct is 8%.

[zanawi]

Thanks a lot sir.

[zanawi]

dose failing to tick the questions attempted on the answer sheet cover has an effect on marking? please please I fail to do so.

[zanawi]

I’m vary happy. Thank God. I have got 79.

[Author]

Posts