Question
Question 3 [ 25marks] (a) CBG pays 10 percent per annum simple interest on its savings account balances, GCB pays 8 percent interest compounded annually
Question 3 [ 25marks] (a) CBG pays 10 percent per annum simple interest on its savings account balances, GCB pays 8 percent interest compounded annually whereas DB pays 7 percent interest compounded quarterly. If you made a GH5,000 deposit in each bank, how much more or less money would you earn from DB account than : i. CBG account at the end of 10 years? ii. GCB account at the end of 10 years? (15 marks) (b) The prime financial objective of a profit making company is to maximise shareholder wealth. Shareholder wealth can be measure by total shareholder return (dividend + share price increase). To maximise shareholder wealth an organisation must take certain key decisions. Discuss three (3) key decisions that can be taken in order to maximise shareholder wealth of an organisation. (10 marks)
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