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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › Q5 of Dec 2014
Dear Sir,
Please help me to explain the answer of question 5 of Dec 2014
I do not understand why it is necessary to calculate NPV 3.83 @ discount 4% and calculate NPV -1.58 @ discount 5%
And why Kd = 4 + [(1×3.83)/(3.83+1.58)]
Thank you
Dear Sir,
I understand, actually, it is for purpose of calculate IRR
I think it is faster to use formula in excel to calculate IRR than the method of trial and error by 2 value as the answer
Thank you
But you do not have excel in the exam!!!
The spreadsheet available in the exam is not excel and you will need to make two guesses in order to calculate the IRR.
Sorry, I am not clear about your idea.This is 1 question in section C.Do you means that the environment for answer this question is word, not exel?If so, is is not convenient for calculation.
It is a spreadsheet like excel, but it is not excel.
Do look at the specimen computer based exam on the ACCA website.
I already look at the spicemen CBE.I can use formula IRR with spreadsheet like exel.I think it is enough.And I understand that it is no need to make 2 guesses to calculate IRR as you said.Sorry but I am not still understand what you mean.Please explain more detail.
You are expected in the exam to be able to understand calculating the IRR by making two guesses as I explain in my lectures. The exam tries to test your understanding and not simply learning rules. Look at past exam questions (and answers) in your Revision Kit.
