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Mock Exam March 2024 - Question Paper

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117 views

Mock Exam March 2024 - Question Paper

Uploaded by

minhnguyenminh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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March 2024 Mock Exam # 1 – AFM by Taha Popatia at VIFHE

Time allowed: 3 hours 15 minutes


This question paper is divided into two sections:
Section A – This ONE question is compulsory and MUST be attempted
Section B – BOTH questions are compulsory and MUST be attempted
Question # 1

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March 2024 Mock Exam # 1 – AFM by Taha Popatia at VIFHE

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March 2024 Mock Exam # 1 – AFM by Taha Popatia at VIFHE

Required

(a) Explain what a reverse takeover involves and discuss the relative advantages and
disadvantages to a company, such as Chrysos co, of obtaining a listing through a
reverse takeover as opposed to an initial public offer (ipo) (5 marks)
(b) Prepare a report for the board of directors of Chrysos Co which includes:
I. An extract of the financial position and an estimate of Chrysos co’s value to
the equity holders, after undertaking the restructuring programme.
(16 marks)
II. An explanation of the approach taken and assumptions made in estimating
Chrysos Co’s value to the equity holders, after undertaking the
restructuring programme. (5 marks)
III. A discussion of the impact of the restructuring programme on Chrysos Co
and on the venture capital organisation. (10 marks)

Professional marks will be awarded in part (b) for the format, structure and presentation
of the report (10 marks)

(c) Discuss why the attention Chrysos Co pays to its stakeholders represented on the
supervisory board may change once it has obtained a listing (4 marks)

(50 marks)

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March 2024 Mock Exam # 1 – AFM by Taha Popatia at VIFHE
Question # 2

Required

(a) Discuss the advantages and disadvantages of using the currency swap to manage
financial risks associated with the franchise in Wirtonia. (5 marks)
(b)
I. Calculate the annual percentage interest saving which Buryecs Co could
make from using a currency swap, compared with borrowing directly from
Wirtonia, demonstrating how the currency swap will work. (4 marks)
II. Evaluate, using net present value, the financial acceptability of buryecs co
operating the rail franchise under the terms suggested by the government

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March 2024 Mock Exam # 1 – AFM by Taha Popatia at VIFHE
of Wirtonia and calculate the gain or loss in € from using the swap
arrangement (5 marks)
(c) Calculate the results of hedging the receipt of $7,500 milion using the currency
options and discuss whether currency options woud be a better method of
hedging this receipt than a currency swap (6 marks)

Professional marks (5 marks)

Question # 3

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March 2024 Mock Exam # 1 – AFM by Taha Popatia at VIFHE
Required

(a) Calculate the valuation and yield to maturity of Toltuck Co’s $100 bond under its
old and new credit ratings (8 marks)
(b) Discuss the factors which may have affected the credit rating of Toltuck Co
published by the credit agency (6 marks)
(c) Discuss the impact of the fall in Toltuck co’s credit rating on its ability to raise
financial capital and on its shareholders’ return (6 marks)

Professional marks (5 marks)

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