MU - S1 2000 - Investment and Portfolio Management

MU - S1 2000 - Investment and Portfolio Management - OFFICE...

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00405KH Page 1 of 7 OFFICE USE ONLY Monash University Semester One Examinations 2000 Faculty of Business and Economics Department of Accounting and Finance EXAM CODES: AFF3121 TITLE OF PAPER: INVESTMENTS AND PORTFOLIO MANAGEMENT EXAM DURATION: 3 Hours READING TIME: 10 Minutes THIS PAPER IS FOR STUDENTS STUDYING AT: (office use only – tick where applicable) Berwick o Clayton o Peninsula o Distance Education o Open Learning o Caulfield Gippsland o Sunway o Enhancement Studies o Other o Candidates are reminded that they should have no material on their desks unless their use has been specifically permitted by the following instructions. AUTHORISED MATERIALS CALCULATORS (except those with 26 alphabet keys) YES NO o OPEN BOOK YES o NO This paper consists of Seven (7) questions printed on Seven (7) pages (including 1 page of formulae and 1 page of tables). Students must attempt ALL questions. PLEASE CHECK BEFORE COMMENCING. This is a FINAL paper. The total marks available in the examination are 100. This examination contributes 70% of the total assessment for this subject. A STUDENT MUST PASS THE EXAMINATION (OBTAIN AT LEAST 50 MARKS OUT OF THE TOTAL 100 AVAILABLE ON THE PAPER) AND OBTAIN AT LEAST 50% IN TOTAL ASSESSMENT TO PASS THE SUBJECT. THIS EXAMINATION PAPER MUST BE INSERTED IN YOUR EXAMINATION BOOKLET/S AT THE COMPLETION OF THE PAPER OTHERWISE A FAIL WILL BE RECORDED.
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OFFICE USE ONLY AFF3121 INVESTMENTS AND PORTFOLIO MANAGEMENT 00405KH Page 2 of 7 Question One (a) Explain what a 'convertible note' is. Describe the advantages and disadvantages of this security form for an individual investor. (b) What is meant by ‘primary’ and ‘secondary’ markets in the context of the capital market? Why is the existence of vigorous secondary markets important? (c) Bailey Shoes Limited has three million ordinary $1 shares on issue and has decided to make a 1 for 3 renounceable rights issue at $1.85 to finance expansion into the Perth and Brisbane markets. The issue will be underwritten by Ware Partners for $40,000. Immediately following the announcement of the issue, Bailey Shoes were trading at $2.25. (i)
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MU - S1 2000 - Investment and Portfolio Management - OFFICE...

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