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Hi,
I would like to ask some question regarding the BA1 note provided by OpenTuition
1. There is some information that is in the Note, but not in the official Kaplan book. For example: how to calculate the NPV with depreciation. So should I still try to study them, or I can ignore them?
2. In chapter 10 (Financial Mathematics), test question 7: why is the $5 million cost of building the apartments not calculated in the NPV?Thank you so much!
Knowing that NPV is before depreciation is important and so depreciation adjustments, like adding it back to post-depreciation income should be known.
In Q7, we made an error. The 5M cost should be deducted to get the NPV.
Sorry. Thanks for pointing it out. We will correct it shortly.
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