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Ok i voted for OK not easy even though this was by far the least challenging compared to all past papers and could be done well in time, guess examiner is finally mindful of our feedback to make it possible in time . The reason not being easy as there were no free knowledge marks. The scenario had to be dealt with and discussion carried out
I screwed the Apv part ,there was no tax delay but i considered it.
Lastly i predicted foreign currency and foreign investment wont come, its biggest mistake to ever guess AFM , especially now CBE format is here, exams are different for candidates instead of one universal paper,
Some candiates got interest and real options those were my core strong, but due to guessing those marks gone down the drain.
mainai92 wrote:dve1 wrote:
michaelrhys89 wrote:When working out the cost of equity – is CAPM alone the cost of equity?Did you use the 1.25 beta or 2.3 beta to degear the beta?
michaelrhys89 wrote:When working out the cost of equity – is CAPM alone the cost of equity?
I use 1.25 to degear, got 0.9 I think then regeared and got 2 something
I didn’t get any CAPM question. But yes the sensitivity analysis of the contribution was confusing. What were you guys’ answer for IRR?
michaelrhys89 wrote:When working out the cost of equity – is CAPM alone the cost of equity?
I’m not sure, maybe we calculated equity and debt differently for the proxy company. It was a pretty tricky paper
michaelrhys89 wrote:When working out the cost of equity – is CAPM alone the cost of equity?
Yeh that sounds like what I had – 19% at the end I think from what I can remember?
Did anyone got working capital and Npv (contribution 200per unit) ques in sec C
Yes, me. What were your answers for the operating cycle, miller orr model? And the NPV and sensitivity of IRR as well. I left the contribution question.
Heyy i forgot the question in section C but did we have to calculate wacc or just only cost of equity coz ugh i mistakenly calculated the whole wacc?
michaelrhys89 wrote:When working out the cost of equity – is CAPM alone the cost of equity?
well I hope we are correct because I found out I also did not do well in other part and might fail :'(
Cash operating cycle I got 41 days, Miller or model I don’t remember, but did that. How did you calculate sensitive without Npv in investment ques?
When I saw other people got 12% and 11%, I got worried a bit but I feel relieved I’m not the only one with 17% and 19%. Hopefully get a pass for the exam …..
I had the question about the cash operating cycle and then NPV / sensitivity in section C. I know I didn’t do them right but hoping for some follow through marks on my workings…
I got $466 npv, treated subsidy as after tax inflow. Sensitivity was 10%, npv/pv of contribution. I rounded numbers $000. Had loss in first year so tax return rather than payment.
CAPM was 17% & 19%, had to degear proxy for 0.95 & regear for us about 2.4 I think then project specific cost of capitalI did exams in the evening and got very different section 3 questions
the first one was to calculate NPV using real and nominal (10marks)
b) discuss real and nominal
c) beneifts of leasing an asset over debt financing (6marks)questions 32
WACC- only consisted on PS, loan notes and equity (10marks)
b) discuss what is prohibited under islamic finance (6marks)
c) Discuss uncertainity in relation to IA (4marks)My section A was more theory based
Section B was forex, WCM and cant recall the last area.Guys did anyone else got cashflow of 0 in year 1 of npv Q and did we have to use fixed costs or ignore them in NPV Q? does anyone remember their npv?
which organisation doesnot use money market? NFP organisation or SMEs or public listed Co?
i got 17.8% for the first one but the other one was lower around (11-14%) i dont really remember. what did u do after u got 0.9 asset beta? i used the values of our actual/current company to regear equity beta and then used that in capm.
The paper was okay for me. I had soo many confusions while attempting the exam. I didn’t really study spread and Baumol. I got the answer for return point somewhere in 26000 and with baumol 53.
I got 17.8 and 11.5 for CAPM question. I thought it was wrong until I saw all the comments. The NPV question was good except it was tricky for the subsidy part. Should we include subsidies in NPV calculation after taking account of tax?
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