Business Calculations - Assignment
Added on 2020-12-24
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Business Calculations
Table of ContentsTASK 1............................................................................................................................................1Question 1....................................................................................................................................1Question 2....................................................................................................................................1Question 3....................................................................................................................................2Question 4....................................................................................................................................3Question 5....................................................................................................................................3Question 6....................................................................................................................................7TASK 2............................................................................................................................................8Question 1....................................................................................................................................8Question 2....................................................................................................................................9Question 3....................................................................................................................................9Question 4..................................................................................................................................10Question 5..................................................................................................................................11Question 6..................................................................................................................................11Question 7..................................................................................................................................11Question 8..................................................................................................................................11REFERENCES..............................................................................................................................13
TASK 1Question 1Holding period return: Income+ (End of period value- Initial value)/ Initial valueDominoz Pizza Enterprises LimitedYearIncomeInitialEnd ofyear value(Adjusted)Holdingperiodreturn2013-140.33110.8419.661.1452014-150.43621.4533.170.9822015-160.61934.4364.11.4812016-170.87268.2149.690.6002017-181.0351.77511.015Retail Food Group Limited:YearIncomeInitialEnd ofyear value(Adjusted)Holdingperiodreturn2013-140.213.953.8280.1792014-150.2284.534.760.2792015-160.2485.435.1020.1882016-170.2935.564.5490.1112017-180.154.650.54-0.734Question 2Expected return: R1 P1+ R2P2+.......RnPn Note: In order to calculate expected return probability is distributed on the basis ofassumptions.Dominoz Pizza Enterprises LimitedHoldingperiod returnProbability1.1450.20.9820.21.4810.21
0.6000.21.0150.2= (1.145*0.2) + (0.982*0.2) + (0.1481*0.2) + (0.600*0.2) + (0.1015*0.2)=1.0447Retail Food Group Limited:Holding periodreturnProbability0.1790.20.2790.20.1880.20.1110.2-0.7340.2= (0.179*0.2) + (0.279*0.2) + (0.188*0.2) +(0.111*0.2) + (-0.734*0.2)= 0.0045551789Question 3Total return to shareholders for Dominos: [P5+D1-5/P0](1/5)-1[51+ (0.331-1.03) /40.40] (1/5 )-1= [51-0.699 /40.40] (1/5 )-1= [1.245] (1/5) -1= [1.245]0.20 -1= 1.044-1= 0.044Total return to shareholders for Retail: [P5+D1-5/P0](1/5)-1[0.54+ (0.21-0.15) /0.19] (1/5)- 1= [0.54+ 0.06 /0.19] (1/5)- 1= [3.158] (1/5)- 1= [3.158]0.20 -1= 1.259-1= 0.2592
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