@adossa3
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Up6
Thanks very much Zee! Awesome, was so confused. 🙂
want to learn formulas over the next week and go over the stuff am finding hard. Extr tired today and progress is v slow….Thank you, thank you thank you Zee and Sophie for the moral support also !Up6about 55% in practice …did 2
Up5Thanks very much Mattyc – clear now.
Up4Thanks very much for your clarification – much appreciated.
Up4Thanks very much !
Up3Recommended pen as scared answers may fade out
Up3Hi Vincentt,
Yes, its 2007 Q1 – having trouble pasting from the exam PDF here.
the ingrams have 4m as current portf. they need to leave 3m in current dollars 35 years down the road, and their inflation adjusted living expenses are 200,000 x 1.025 = 205,000 for the next year.
2 answer options given in answer key:
1) N = 35 PV 4m pmt -205,000 FV -3m, I/y = 4.84%
Pmt and FV both neg inputs here. dont understand.is it because they are both portfolio OUTFLOWS that the sign is neg ?
2) N = 35 PV -4m pmt 205,000 FV -3m, I/y = 4.84%
Both PV and FV neg inputs here. dont understand.
Nominal pre-tax return to be calc.Answer:
Real req return 4.84%
Inflation adjustment 2.5%
Nominal pre-tax return 1.0484 x 1.025 = 1.07461 or 7.46%Many thanks
Up2Yep, mine was a horrid experience. Running short of time in AM, as made sure i did Retail and inst. properly, but then lacked time to do other 50% of the AM paper. Then panicked, tried to calm down, wd succeed in reducing tension, only to realise that i was not being able to read cases properly, was jumping to qs, to write what i cd. Pm session was not as easy , at least to me, as people around me, found it, people discussing after the exam, said that 2012 last yr was easier, and the year before that was even easier, both AM and PM. I shall have to do again next year. What shd i do ? i studied so hard, last 2 months, but the last 3 days, before exam was a bad cae of nerves. When shd one start doing the past papers – a good 30 days before. my mistake, i tried doing them on May 10 and realised i had not revised enough to do them, cd do 50% of the papers only. My mistake, and now looking back, did not have the time mgt practice, even though i knew the material. Feel awful, shfd be ready to do papers by 1st of May, as you need time to learn what you dont know. Feel lost as well, and aimless.
Up2Thanks – need to learn from my mistakes – PMgt IPSs essay killed me as other qs,. and 2nd half was all over 70% – so must have done really badly – dont know what to do.
Up2Zwzard def. has a point. You dont see where u are going wrong. Still trying to figure out how i got below 50% in the P mgt retail and inst essay, was it analysis and explanation, calc. ? or babbling on and not getting to the point ? at a loss. stumped again.
Up2Thanks very much Vincentt
Up2Hi there,
trouble with below answer:‘It is not appropriate to use the expected return of the assets used to fund spending needs to calculate the capitalized value of their core capital needs, because the risk of the Pearsalls’ spending needs is unrelated to the risk of the investment portfolio used to fund those needs. (understood) Although the annual spending cash flows are not riskless, a risk-free rate should be used to calculate the present value of the cash flows as their uncertainty is unrelated to market risk factors that would be priced in a normal asset pricing model, making their beta equal to zero. (didnt understand this sentence)’
Thanks very much.
Up1Hi, yep, saw the IPS tips – many thanks
Up1Thanks very much Vincentt. Clear now. You are a whizz 🙂
Up0Hi Everyone ! am L3 candidate and struggling away ….! Many thanks to the immediate and very helpful replies i got today. Am very impressed with the site and the quality of output. Fantastic effort ! Congratulations and thank you ! Finding i cant remember what stuff i had done some weeks ago. sometimes mind is a blank when i thought i got down a concept well..eeek ! I find the return requirement most hard to nail. What do i do, just do the past exam papers ? Many thanks for your dedication and support !
