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MAC2602 ASSIGNMENT 1 – SEMESTER 1 OF
2022
Question 1

Generally accepted competitive strategies that are available to an organisation are:



1. Leadership strategy

2. Differentiation strategy.

3. Penetration strategy.

4. Pricing strategy.



a.

Statements (1) and (3)



b.

Statements (1) and (4)


c.

Statements (2) and (4)




1
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, d.

Statements (3) and (4)

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Your answer is correct.




2
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, The correct answer is:


Statements (2) and (4)

Question 2

Correct
Mark 3.00 out of 3.00




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Question text

Megatron Ltd has an equity beta of 1.5. The market risk premium in South Africa is expected to
be 5% and yield on government bond (risk free rate) is currently 9.5%. Megatron has issued
bonds and its R100 par value bond is currently trading at R94.50. The coupon is 10%. The
maturity date is in 5 years’ time and the corporate tax rate is 28%. Interest is payable annually in
arrears.

What is the after-tax cost of debt?


a.

11.51%


b.

8.29%


c.

8%


d.

7.62%

3
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