Exam (elaborations) BAN3701 Past Exam Papers & Solutions From Nov2017 to Nov2020

BAN 3701

Past Question Papers and Solutions

October/November 2017



Section 1(TRUE/FALSE QUESTIONS)

1. False
2. True
3. False
4. False
5. True



Section 2(MULTIPLE CHOICE QUESTIONS)

1. 2
2. 2
3. 4
4. 1
5. 3 Er = (Pi x ri)
= (0,6 x 10) + (0,4 x 4)
= 8,64
6. 2
7. 1
8. 3
9. 3
10. 3



Section 3(CALCULATIONS AND INTERPRETATIONS)

3.1.1 Er = (Pi x Ri) + (Pi x Ri) + (Pi x Ri) + (Pi x Ri)
= (0,40 x 12) + (0,28 x 7) + (0,12 x 3) + (0,20 x 3)
= 7,72%

3.1.2 Ꝋ 2
= Pi (ri - ṝ)2 + Pi (ri - ṝ)2 + Pi (ri - ṝ)2 + Pi (ri - ṝ)2
= 0,40 (12 – 7,72)2 + 0,28 (7 – 7,72)2 + 0,12 (3 – 7,22)2 + 0,20 (3 – 7,72)2
= 14,60

3.1.3 Ꝋ = √Ꝋ 2


Ꝋ = √14,60

Ꝋ = 3,82



3.2 r = Pt – Po + Di

, Po

162 350 – 150 500 + 3 560 x 100

150 500



= 10,24%



3.3 Pn (1 + R1) (1 + R2) (I + Rn)

= (1 + 0,0922) (1 + 0,0462) (1 – 0,015)

= 1,1255


�
r = �� - 1
3
r= 1,1255 - 1

= 0,04019596899 x 100

= 4,02



3.4 Share A

V = D1___

K–g



= __1,22______

0,13 – 0,05

= R15,25
- Therefore, the market price = R31,20
Value of share = R15,25

- When the market price is greater than the value of the share, it means that the shares are
over-valued, and the investment decision would be to sell the shares



Share B

V = D1___

K–g

= 1,06_______