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Pardon me its been a few years since I completed F3.
1. Gearing Formula is D/(D+E) or would it be D/E?
2. PPPT: Inflation rate in US 4% and UK 2% $/GBP 1.75 calculate the 3 month rate
Two ways a) 1.75(1.04/1.02)^3/12 = 1.7585
b) 1.75 x (1+0.04/4)/(1+0.02/4) = 1.7587
They yield slightly different answers. Which does the CIMA examiner prefer for examination purposes? Would you know?1. The recommendation is for gearing not to exceed 50% this wld refer to D/(D+E)?
and what is the recommended figure for D/E?2. PPPT I shalI use this method 1.75(1.04/1.02)^3/12 = 1.7585 then in the exam.
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