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Question

Instruction: Please do research and then explain the following exercises

in your own opinion and understanding, also make sure to input references as well.
 
Exercise 1:
Ajax Co Ltd is considering investing in a Manufacture project in Africa. Initial estimates of the returns of the project have revealed the following figures:
PROBABILITY                                     RETURNS
0.10                                                         -15%
0.20                                                          16%
0.35                                                          20%
0.25                                                          35%
The current risk-free rate of return in the market is 7.5%. Ajax Co board of directors has decided that infrastructure projects are risky in general and as such a risk premium of 15% is required.
Should Ajax Co invest in this particular project? Why or why not?
 


Exercise 2:
Explain the terms: Merger, Acquisition, and Takeover.
 
Exercise 3:
Read and the explain your own understanding on the following article, the article link is given below:
https://www.abc.net.au/news/2020-06-22/australian-share-market-coronavirus-second-wave-miners-rise/12379054 (The name of the article: Australian share market ends little changed as fears of second wave of coronavirus hit travel stocks)

Step-by-step answer

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