*** ACCA P4 June 2018 Exam was.. Instant Poll and comments ***

I messed up big time too my entire paper was messy, lots of scratches . Started with question 4 hedging strategy …took too long…did not complete question 2 or #1 for that matter….my final paper and I messed up big time….still hope I did enough to pass

I for some dumb reason read cost of equity as cost of capital….found my error 5 minutes before exam……went on a correction run for 5 minutes until pens down. 7.2%…..but I had 12. Corrected about 75% but the incorrect answer put me off the rest of the paper. Surprised if I pass

I have replied that it is option to abandon, put option, but I am not sure that I have calculated accurately value of option.
Paper is so long, I have already read all questions and remember the content of questions until now but I don’t have enough time to finish all well 🙁
I don’t understand means of swap 1×4…

9 marks for advantage and problem with buying Polymnia
12 marks for calculating value of Poly in case of growth rate of 5% and 0%, discussion about result
4 marks for discussion about calculating value of Poly with use of P/E and asset valuation method
I remember so….

@ashleeeyc said:
does anyone remember the marks allocation for Q2?

I messed up badly, sigh

@sahil1234

I’m not sure i understand what you are saying.

Do you mean that the current BASE RATE was 4%?

what unexpired basis did you get?
I got a clean .77 * 1/7 which i thought showed me that I was on the right track. 😀 🙂

maybe i’m wrong.

I dont think so sahil1234.

Looking back at the past papers , the examiner has clearly meant that the increase in x amount of interest rate is actually the bank rate increase.

example AWan Co (12/2013)

Maybe im misreading what you are saying.

It was an option to delay

@ivonne said:

@gt0707 just a guess based on the marks allocation of similar question in the past, may lose 6~8 marks at maximum if not adding 40 basis points, as such may lead to incorrect calculation of “impact of interest rate increase and decrease with future” (about 3 marks), “impact of interest rate increase/decrease with option” (about 3 marks) and “discussion & recommendation” (about 3-4 marks in total)

Ok thank you. Damn that’s a lot of marks missed due to silly mistakes.

BTW 49 contracts is correct i guess coz most of us got this.

Yeah. It was Vega.

i just put some influences. No idea about the influences.

Yes I got 5% and 3.4% too. I think he was trying to trick people.

What did people recommend to The Board of Directors about Project A, B, C & D?
My recollection was A b and c has returns above the Cost of Capital , so I said if you can borrow / fund through equity do , and D was a very low return so don’t invest.

@elaine thought the question mentioned the decision criteria of the company: reject project with negative NPV, select project that optimize the soft capital rationing if project with positive NPV……Here the NPV need be considered is NPV before and after considering the value of options…By referring to related TA, I don’t think the examiner may try to test us anything beyond regarding the recommendation…

@unnysnowflakes said:
What did people recommend to The Board of Directors about Project A, B, C & D?
My recollection was A b and c has returns above the Cost of Capital , so I said if you can borrow / fund through equity do , and D was a very low return so don’t invest.