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Q.4. Calculate the NPV of the following project with a discount rate of 8 per cent. Point in time (yearly intervals) 0 1 2 3

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Q.4. Calculate the NPV of the following project with a discount rate of 8 per cent. Point in time (yearly intervals) 0 1 2 3 4 5 Cash flow (OMR 000) -1,200 450 400 345 200155 Now examine the impact on NPV of raising the discount rate by a risk premium of 4 percentage points. (1.5 + 1.5 marks) Q.5.(a) Define the term Beta". (0.75 marks) Q.5.(b) The details of your portfolio are as shown in the following table: Name of company Market Price Number of shares Beta ADB 2.25 12,000 0.8 ABC 3.30 15,500 1.3 ADE 1.85 4,200 1 Calculate the beta of your portfolio. (2.25 marks)

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