Inv2601 Assignment 1 semester 1 2024

3/15/24, 12:30 PM Assessment 1: Attempt review




INV2601-24-S1  INV2601 Welcome Message  Assessment 1

QUIZ




Started on Friday, 15 March 2024, 11:26 AM
State Finished
Completed on Friday, 15 March 2024, 12:29 PM
Time taken 1 hour 3 mins


Question 1
Complete

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On January 1, you bought 500 shares at R65 and a year later sold them for R68 a
share. During the year, you received a dividend of R2 per share. Assuming the rate of
inflation is 5%. Calculate the real rate of return on this investment.




a. 2.56%

b. 3.08%

c. 4.62%

d. 7.69%




Question 2
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Use the table below to calculate the coefficient of variation.

State of the economy Probability of occurrence (%) Rate of return

Boom 20 8

Normal 30 10

Recession 50 12




a. 0.1474

b. 0.2302

c. 0.6402

d.
6.7862




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, 3/15/24, 12:30 PM Assessment 1: Attempt review

Question 3

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If you place a stop-loss order to sell 500 shares of Nedbank at R130 when the
current price is R135, how much will you receive for each share if the price drops to
R127?




a. Close to R127

b. Close to R130

c. Close to R135

d. Won’t sell because the price is too low




Question 4
Complete

Marked out of 1.00




Mondi Ltd has a current price of R20 per share, an expected growth rate of 9%, and
an expected dividend in the next year of R1.00. Given its risk, you have a required
rate of return for the share of 17%. Determine the expected rate of return and the
investment decision you would make.




a. 5% Buy

b. 5% Sell

c. 14% Buy

d. 14% Sell




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