Specifically, the control process is made up of ______ steps.
Initial calculations suggest that the proposed investment in Naswa would have a negative net present value of $1·01 million. However, Furlion Co’s chief executive believes that there may be opportunities for greater cash flows in future if the Naswan government expands its land reclamation programme. The government at present is struggling to fund expansion of the programme out of its own resources and is looking for other funding. If the Naswan government obtains this funding, the chief executive has forecast that the increased demand for Furlion Co’s products would justify $15 million additional expenditure at the site of the factory in three years’ time. The expected net present value for this expansion is currently estimated to be $0.
It can be assumed that all costs and revenues include inflation. The relevant cost of capital is 12% and the risk free rate is 4%. The chief executive has estimated the likely volatility of cash flows at a standard deviation of 30%.
One of Furlion Co’s non-executive directors has read about possible changes in interest rates and wonders how these might affect the investment appraisal.
Required:
(a) Assess, showing all relevant calculations, whether Furlion Co should proceed with the significant opportunity. Discuss the assumptions made and other factors which will affect the decision of whether to establish a plant in Naswa. The Black Scholes pricing model may be used, where appropriate. (16 marks)
(b) Explain what is meant by an option’s rho and discuss the impact of changes in interest rates on the appraisal of the investment. (5 marks)
(c) Discuss the possibility of the Naswan government obtaining funding for further land reclamation from the World Bank, referring specifically to the International Development Association. (4 marks)
He was specifically asked to write a play that would be______to the local community.
A.flexible
B.accessible
C.responsible
D.capable
A.Crack
B.Smurf
C.Flood
D.Worm
Special commodity rate (SCR) mean a rate applicable to carriage of specifically designated commodity.( ).
A.explicitly
B.specifically
C.speculatively
D.specially
A credit calls for shipment of (description of goods) FOB Shanghai. A presented commercial invoice does not specifically state "FOB Shanghai".
(1)( ) It is a discrepancy.
(2)( ) It is not a discrepancy.