1. Calculating Net Present Value:

(a) Calculate the present value of RM 2,500,000 (future value) received from Power Plant Project in five years (i.e., 2026) from today (i.e., 2021) when the interest rate is 6% per year? Provide the percentage of interest and percentage of principal (i.e., from RM 2,500,000).

(10 marks)

Note: You will need to show your calculations to earn full marks.

(b) Average price of land per square feet in Kuala Lumpur (KL):

Year Price

2016 447.77

2017 529.19

2018 592.11

2019 622.90

2020 776.09

2021 812.02

Calculate the compound annual growth rate (CAGR) of land price, per square feet in KL (round it up to two decimal place).

(10 marks)

Note: You will need to show your calculations to earn full marks.

(c) Based on the CAGR of land price (per square feet in KL), if you invest the principal money you obtained from Q1(a), how much would you receive in 5 years. Would you invest Power Plant Project or Land in Kuala Lumpur?

(10 marks)

Note: You will need to show your calculations to earn full marks.