Question 8 Capital and asset types Tier1 capital Tier 2 capital Corporate debenture Mortgage loan Loan to government ('000) 3000 1000 9000 45,000 4000 a) Calculate risk weighted asset b) Calculating the Capital Adequacy Ratio (CAR) c) Why Capital Adequacy Ratio Matters? Risk weight 90% 75% 0
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![Question 8
Capital and asset types
Tier1 capital
Tier 2 capital
Corporate debenture
Mortgage loan
Loan to government
('000)
3000
1000
9000
45,000
4000
a) Calculate risk weighted asset
b) Calculating the Capital Adequacy Ratio (CAR)
c) Why Capital Adequacy Ratio Matters?
Risk weight
90%
75%
0](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ffba675d4-9eee-4ed8-8ba1-d385d2e466e7%2F56aceccd-48e3-4992-a39d-4b258708a35b%2Fwchcmbr_processed.jpeg&w=3840&q=75)
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- Match the words with the term. Question 6 options: 12345 financial need 12345 risk capital 12345 internal source 12345 external sources 12345 financing requirement 1. working capital 2. subordinated debt 3. lenders 4. short-term debt 5. retained earningsQ44 Cost of the capital is the minimum required rate of earnings or the cut-off rate of capital expenditure, is defined by a. William and Donaldson b. John J. Hampton c. Solomon Ezra d. James C. Van HorneB с D E 1 Using the set of assumptions calculate the NPV, BCR and IRR for this project: 2 3 EBIT 4 CapEx 5 Depreciation 6 Increased working capital 7 Shares outstanding 8 Tax rate 9 WACC 10 Terminal growth rate 11 Value of debt 12 13 14 EBIT 15 Tax 16 EAT 17 Dep 18 Cap expenditures 19 Increase in WC 20 FCF 21 22 23 WACC 24 Terminal growth rate 25 Terminal value 26 27 28 Value of debt 29 Value of equity 30 Shares outstanding 31 Estimated value per share Estimated value of firm $120.0 million $25.0 million $15.0 million per year $18.0 million 4.0 million 21.00% 12.50% 4.00% $85.0 million 17.50% 21.00% 10.00% 12.50% 4.00% 1 Year 1 Year 1 Fixed over 5 years 2 F Growing at Growing at 3 G 17.50% 10.00% 4 H 5 I 6
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