CWM_LEVEL_2 Exam Results

Section A (1 Mark)

In US Over one-half the money spent by state and local governments goes to just three services. Which of the following is not one of these services?

Section A (1 Mark)

According to Prospect Theory, investors are more concerned with changes in wealth than in returns. Prospect Theory suggests that investors:

Section C (4 Mark)

OHM Corporation, an environmental service provider, had revenues of Rs209 million in 1992 and reported losses of Rs3.1 million. It had earnings before interest and taxes of Rs12.5 million in 1992, and had debt outstanding of Rs109 million (in market value terms). There are 15.9 million shares outstanding, trading at Rs11 per share. The pre-tax interest rate on debt owed by the firm is 8.5%, and the stock has a beta of 1.15. The firm's EBIT is expected to increase 10% a year from 1993 to 1996, after which the growth rate is expected to drop to 4% in the long term. Capital expenditures will be offset by depreciation, and working capital needs are negligible. (The corporate tax rate is 40%, and the Risk free rate is 7%.)

Estimate the value of the firm.

Section A (1 Mark)

An aggressive asset allocation would contain larger proportions of __________ than a conservative allocation.