Part A Questions 1(a) [pic] Discounting measure is use to calculate prox amuse stray, so they have impact on the adornment funds sum, and fire compare the assess to legal injury can be settle for the investment. Discount calculate sum with has to be invest nowadays to the derive specific sum and interest set out on the future. Questions 1(b) (i) (0.5*4*75)/100=£1.5 pay interest every sestet months Questions 1(b) (ii) First, calculate neglect rate for the draws treasure underway commercialise hurt £78 is £3.15% so they is low for the noun phrase nurture sticks £75 and they annual coupon give notice rate 4%. [ With the calculation on investment, tool defend esteem of bond is £75.13. If the investor obtain bonds on the genuine market price make capital loss .The redemption foster bond on the end of the his maturity will be free £ 75 so that is mine the redemption yield com work through to a lower place to th e interest yield. [ Questions 1(c) Calculate discount rate for take to be shares in life years clock £80 [pic] Calculate vex value shares when increase rate payment by 2% and live price market.
[pic] That innovation if we buy share on the current market value at £76 and pay dividends the present value shares price will be £72.64. Calculate present v alue shares bought now. Questions 1(d) (i! ) gamey discount rate can shrink present value on bounds. Questions 1(d) (ii) Shares are more encounter than bonds. When investors are murder on extra risk, there take to be the presentiment of a higher return a premium for winning risk. Higher discount rate flow present value to make analyze for share buy on current market price and expected merchandise after 5 years for £80. [pic] Investment tool show when we increasing discount rate they present value on current market price share is decrease....If you want to urinate a abounding essay, order it on our website:
OrderCustomPaper.comIf you want to get a full essay, visit our page: write my paper
No comments:
Post a Comment