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(b) Calculate the internal rate of return of the proposed investment and comment on your findings. (5 marks)
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A low rate of domestic industrial investment coupled with a very high rate of overseas investment is still a characteristic of the UK economy.()
此题为判断题(对，错)。
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PV Co is evaluating an investment proposal to manufacture Product W33, which has performed well in test marketing trials conducted recently by the company’s research and development division. The following information relating to this investment proposal has now been prepared.Initial investment $2 millionSelling price (current price terms) $20 per unitExpected selling price inflation 3% per yearVariable operating costs (current price terms) $8 per unitFixed operating costs (current price terms) $170,000 per yearExpected operating cost inflation 4% per yearThe research and development division has prepared the following demand forecast as a result of its test marketing trials. The forecast reflects expected technological change and its effect on the anticipated life-cycle of Product W33.It is expected that all units of Product W33 produced will be sold, in line with the company’s policy of keeping no inventory of finished goods. No terminal value or machinery scrap value is expected at the end of four years, when production of Product W33 is planned to end. For investment appraisal purposes, PV Co uses a nominal (money) discount rate of 10% per year and a target return on capital employed of 30% per year. Ignore taxation.Required:(a) Identify and explain the key stages in the capital investment decision-making process, and the role ofinvestment appraisal in this process. (7 marks)(b) Calculate the following values for the investment proposal:(i) net present value;(ii) internal rate of return;(iii) return on capital employed (accounting rate of return) based on average investment; and(iv) discounted payback period. (13 marks)(c) Discuss your findings in each section of (b) above and advise whether the investment proposal is financially acceptable. (5 marks)
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Moonstar Co is a property development company which is planning to undertake a $200 million commercial property development. Moonstar Co has had some difficulties over the last few years, with some developments not generating the expected returns and the company has at times struggled to pay its finance costs. As a result Moonstar Co’s credit rating has been lowered, affecting the terms it can obtain for bank finance. Although Moonstar Co is listed on its local stock exchange, 75% of the share capital is held by members of the family who founded the company. The family members who are shareholders do not wish to subscribe for a rights issue and are unwilling to dilute their control over the company by authorising a new issue of equity shares. Moonstar Co’s board is therefore considering other methods of financing the development, which the directors believe will generate higher returns than other recent investments, as the country where Moonstar Co is based appears to be emerging from recession.Securitisation proposalsOne of the non-executive directors of Moonstar Co has proposed that it should raise funds by means of a securitisation process, transferring the rights to the rental income from the commercial property development to a special purpose vehicle. Her proposals assume that the leases will generate an income of 11% per annum to Moonstar Co over a ten-year period. She proposes that Moonstar Co should use 90% of the value of the investment for a collateralised loan obligation which should be structured as follows:– 60% of the collateral value to support a tranche of A-rated floating rate loan notes offering investors LIBOR plus 150 basis points– 15% of the collateral value to support a tranche of B-rated fixed rate loan notes offering investors 12%– 15% of the collateral value to support a tranche of C-rated fixed rate loan notes offering investors 13%– 10% of the collateral value to support a tranche as subordinated certificates, with the return being the excess of receipts over payments from the securitisation processThe non-executive director believes that there will be sufficient demand for all tranches of the loan notes from investors. Investors will expect that the income stream from the development to be low risk, as they will expect the property market to improve with the recession coming to an end and enough potential lessees to be attracted by the new development.The non-executive director predicts that there would be annual costs of $200,000 in administering the loan. She acknowledges that there would be interest rate risks associated with the proposal, and proposes a fixed for variable interest rate swap on the A-rated floating rate notes, exchanging LIBOR for 9·5%.However the finance director believes that the prediction of the income from the development that the non-executive director has made is over-optimistic. He believes that it is most likely that the total value of the rental income will be 5% lower than the non-executive director has forecast. He believes that there is some risk that the returns could be so low as to jeopardise the income for the C-rated fixed rate loan note holders.Islamic financeMoonstar Co’s chief executive has wondered whether Sukuk finance would be a better way of funding the development than the securitisation.Moonstar Co’s chairman has pointed out that a major bank in the country where Moonstar Co is located has begun to offer a range of Islamic financial products. The chairman has suggested that a Mudaraba contract would be the most appropriate method of providing the funds required for the investment.Required:(a) Calculate the amounts in $ which each of the tranches can expect to receive from the securitisation arrangement proposed by the non-executive director and discuss how the variability in rental income affects the returns from the securitisation. (11 marks)(b) Discuss the benefits and risks for Moonstar Co associated with the securitisation arrangement that the non-executive director has proposed. (6 marks)(c) (i) Discuss the suitability of Sukuk finance to fund the investment, including an assessment of its appeal to potential investors. (4 marks)(ii) Discuss whether a Mudaraba contract would be an appropriate method of financing the investment and discuss why the bank may have concerns about providing finance by this method. (4 marks)
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public class Person { private String name， comment； private int age； public Person（String n， int a， String c） { name = n； age = a； comment = c； } public boolean equals（Object o） { if（! （o instanceof Person）） return false； Person p = （Person）o； return age == p.age name.equals（p.name）； } } What is the appropriate definition of the hashCode method in class Person？（） A、 return super.hashCode（）；B、 return name.hashCode（） + age * 7；C、 return name.hashCode（） + comment.hashCode（） /2；D、 return name.hashCode（） + comment.hashCode（） / 2 - age * 3；
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单选题One reason is that ______ offers a seemingly short return on your investment from both a technology and human resources standpoint.A
itB
theyC
themD
there
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单选题public class Person { private String name， comment； private int age； public Person（String n， int a， String c） { name = n； age = a； comment = c； } public boolean equals（Object o） { if（! （o instanceof Person）） return false； Person p = （Person）o； return age == p.age name.equals（p.name）； } } What is the appropriate definition of the hashCode method in class Person？（）A
return super.hashCode（）；B
return name.hashCode（） + age * 7；C
return name.hashCode（） + comment.hashCode（） /2；D
return name.hashCode（） + comment.hashCode（） / 2 - age * 3；
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问答题什么叫内部利润率（internal rate of return，简记为IRR）？其经济含义和实际意义是什么？
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