QI. Mr. Arvind and Ms. Anunya were classmates while studying their Post Graduate Program in Business Management. Both of them got placed in good jobs and got married after 5 years of their work. After their marriage both continued to work for another 5 years and saved Rs 75 Lakhs. They then decided to set up a company of their own. They decided to place Rs 25 Lakhs in a deposit which was giving a return of 8% p... The remaining amount was invested in their business, Their company this had a humble beginning with an investment of Rs 30 Lakhs and started earning a return of 30% annually. The company was also growing at a rate of 12%. After doing this business for 5 years the couple decided to sell the business and relocate to Australia with parents. They started looking for buyers of their business. They hired a consultant to decipher the value of their business, What would be the process that would be adopted by the consultant? What would be the factors that would influence the value of the business and how would macroeconomic indicators be useful in the process of valuing a business activity? They also needed an estimate of the value of their investment made when they had started their business? In case the five years of investment also saw an inflation of 6%, what would have been the real return of the investment? 1/3 Q2. Mr. Matthew has just joined an Investment Management company as a Wealth Manager. He met his boss Mr. Kartar Singh and the first question asked by Mr. Singh was how to analyse the value of Debt Instruments and what are the factors influencing the value of debt instruments. What do you think he should have answered? Their discussion went into further details as they discussed the recent changes in the Interest rates, Before Mr. Singh asked any questions, Mt. Matthew explained the relationship between the Interest rates and the value of debt instruments which impressed Mt. Kartar Singh completely who supported the theoretical concepts with actual values over the past year. Please explain what must have been the discussion between Mr. Matthew and Mr. Singh. Further, Mr. Matthew was given some additional data to understand and analyze before he met his first client. The client was considering a few options for investment and was a little confused. Mr. Matthew hail to advise the client after calculating the value of each option being considered by him. The options from the client were as follows: Option 1- Bond Issue of a government company. The par value of the bond was Rs 1000 with a coupon rate of 12% to be paid annually for a period of 10 years. The issue price of L-L--------------IL-L- - Li- TI QI. Mr. Arvind and Ms. Anunya were classmates while studying their Post Graduate Program in Business Management. Both of them got placed in good jobs and got married after 5 years of their work. After their marriage both continued to work for another 5 years and saved Rs 75 Lakhs. They then decided to set up a company of their own. They decided to place Rs 25 Lakhs in a deposit which was giving a return of 8% p... The remaining amount was invested in their business, Their company this had a humble beginning with an investment of Rs 30 Lakhs and started earning a return of 30% annually. The company was also growing at a rate of 12%. After doing this business for 5 years the couple decided to sell the business and relocate to Australia with parents. They started looking for buyers of their business. They hired a consultant to decipher the value of their business, What would be the process that would be adopted by the consultant? What would be the factors that would influence the value of the business and how would macroeconomic indicators be useful in the process of valuing a business activity? They also needed an estimate of the value of their investment made when they had started their business? In case the five years of investment also saw an inflation of 6%, what would have been the real return of the investment? 1/3 Q2. Mr. Matthew has just joined an Investment Management company as a Wealth Manager. He met his boss Mr. Kartar Singh and the first question asked by Mr. Singh was how to analyse the value of Debt Instruments and what are the factors influencing the value of debt instruments. What do you think he should have answered? Their discussion went into further details as they discussed the recent changes in the Interest rates, Before Mr. Singh asked any questions, Mt. Matthew explained the relationship between the Interest rates and the value of debt instruments which impressed Mt. Kartar Singh completely who supported the theoretical concepts with actual values over the past year. Please explain what must have been the discussion between Mr. Matthew and Mr. Singh. Further, Mr. Matthew was given some additional data to understand and analyze before he met his first client. The client was considering a few options for investment and was a little confused. Mr. Matthew hail to advise the client after calculating the value of each option being considered by him. The options from the client were as follows: Option 1- Bond Issue of a government company. The par value of the bond was Rs 1000 with a coupon rate of 12% to be paid annually for a period of 10 years. The issue price of L-L--------------IL-L- - Li- TI
