Past exam papers_ OCTNOV_2006

Past exam papers_ OCTNOV_2006 - UNIVERSIW EXAMINATIONS...

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Unformatted text preview: UNIVERSIW EXAMINATIONS UNIVERSITEITSEKSAMENS UNISAIffi MNF202-3 14722831 october/November2006 BUSINESS MANAGEMENT (FINANCIAL) 202 70 Marks DR MS NGWENYA I'R KS NAICKER Duratbn r 2 Hours E)G[4lNERs I j'[""J*, U8e ote non-programmable pocket calculator permisslbte, Thls paper consrsts of 17 pag€s including 5 pages for rough work (p.'18-22), AppendixA (inleresl tables) (pp. i-iv) and instructions for the completion of a mark reading sheet Answer SECTION A and SECTION B SECTION A is worth 50 marks and SECTION B 20 marks Your final mark will be expressed out ol 70. FURN OVER] MNF202-3 October/November 2006 SECTIONA: MULT|PLECHO|CEeUEST|ONS '1 The key activities of the financial manager include a of the following excepr . making financtng decisions financial analysis and planning managing flnancial accounting making investment decisions 2 How many of the statemenls below are correcl given the following information: 3 o"tober/Nove,H:?31;3 You wilr receive an amount of Rl 7oo eight (g) yearstrom now. However, if you courd receive the amount right now and invest it, you woutd 6e abte to earn 8y" ini"i"ii jJi unnr. on tn" amount. What woutd the amount be worth if you coutd receive it nowiniieJJot waiting eigt t vears. R 819 R 918 R1 564 R1700 1 2 3 4 ,l 1 none-2 one 3 two 4 three 4 I Determine the expected rate of return ifthe following probabilities (p,) and associated raies of return exist: Invsstment B Initial investment R5 000 000 Annual rate of return: Pessimistic Most likely Optimistic Investment C R5 000 000 1l% 140/ 1A% P, 0,20 0,50 0,30 112,00% 2 12,800/0 313,660/0 414,46% 100/o 12% 16% G Rate of return (kr) 'too/o ; 12% 16% - Rate of return (kr) , r, 250/o : 100/0 -- 100k -. ' (a) the range for investment B is 13yo- (b) the range for investnent C is 7olo (c) the risk-averse manager wjll prefer investment C (d) according to sensitivity analysis investment C is preferable 3 You invest R3 600 per year for 10 successive years (at the end of each year) ln a savtngs account at,1solo per annum compound interest. Which one of the following is closest fo th'e eno varue In tne savings account? e, 6 Calculate the standard deviation (d) for the returns of the following asset: f' 0,40 0,50 0,10 10,67% 12,78% 15,00% 25,1so/" 7 R100 is received at the beginning of_ygar i, R2OO is received at the beginnrng of year 2 and R300 is received at the beginnjng ofyear^3. lf.these cash flows are deiositel "tizZlnli, combined fuiure value at the end of year 3 will be . . +l i- v'l ryz 4 \1R672 2R727 3 R1 245 4 R1 536 5)G riLi R73 094,40 R74 390,60 R83 094,40 R93 940,60 TURN OVER] rruRN OVERI 1 .3 4 MNF202-3 October/November 2006 A generous philanthropist plans to make a once offendowment to a respected heart research centre that will provrde the facrlity with R250 000 per year into perpetuily. The rate of interest rs expected to be 8% for all future time periods. How large should the endowment be?...
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Past exam papers_ OCTNOV_2006 - UNIVERSIW EXAMINATIONS...

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