We are here with you hands in hands to facilitate your learning & don't appreciate the idea of copying or replicating solutions. Read More>>

Looking For Something at vustudents.ning.com? Click Here to Search


+ Link For Assignments, GDBs & Online Quizzes Solution


+ Link For Past Papers, Solved MCQs, Short Notes & More

Dear Students! Share your Assignments / GDBs / Quizzes files as you receive in your LMS, So it can be discussed/solved timely. Add Discussion

How to Add New Discussion in Study Group ? Step By Step Guide Click Here.

MGT201 Assignment No 01 Spring 2019 Solution & Discussion

+ How to Follow the New Added Discussions at Your Mail Address?

+ How to Join Subject Study Groups & Get Helping Material?

+ How to become Top Reputation, Angels, Intellectual, Featured Members & Moderators?

+ VU Students Reserves The Right to Delete Your Profile, If?

See Your Saved Posts Timeline

Views: 2960


+ http://bit.ly/vucodes (Link for Assignments, GDBs & Online Quizzes Solution)

+ http://bit.ly/papersvu (Link for Past Papers, Solved MCQs, Short Notes & More)

+ Click Here to Search (Looking For something at vustudents.ning.com?)

+ Click Here To Join (Our facebook study Group)

Replies to This Discussion

Please Discuss here about this assignment.Thanks

Our main purpose here discussion not just Solution

We are here with you hands in hands to facilitate your learning and do not appreciate the idea of copying or replicating solutions. Read More>>

Discussed & be touched with this discussion. After discussion a perfect solution will come in a result at the end.


“How to Join Subject Study Groups & Get Helping Material”


P.S:    Please always try to add the discussion in proper format title like “CS101 Assignment / GDB No 01 Solution & Discussion Due Date: ___________”


Share below link with friends for solution & Discussion. A Single link for help in your education.



Site Overview | Assignment Solutions | Past Papers |Site Features

please upload solution

where is the assignment solution?????

what is solution of this assignment???

An investor, Mr. Ahmed is planning to add shares and bonds in his investment portfolio for which two options are available in the market with the following information:

  1. Shares of Z&R Corporation are currently selling at price of Rs. 45 per share. The forecasted dividend for 1st year is Rs. 5 per share while for year 2 it will be Rs. 5.5 per share. The price of share after year 2 is expected to be Rs. 50. Currently company is paying a dividend of Rs. 4.8 per share while rate of return for such type of investment is 12% per annum.
  2. Raheem Corporation has recently issued a 5 years bond with par value of Rs. 1000 for a 10% semiannual coupon payment. The market interest rate for such type of investments is 12% per annum. Bond is currently trading at Rs. 910.


You are required to help Mr. Ahmed in valuation of both investment options by calculating:

 Value of stock today (8 marks)

 Intrinsic value of the bond (8 marks)

 Compare stock and bond prices with their market prices and identify whether stock and bond is overvalued or undervalued? Justify your answer with proper calculation and reasoning (4 Marks).


NOTE: Formula and complete working is mandatory in each part, provide complete calculations

when we will receieve the solution ?

i think on extended day  


Where is solution of this file?

Value of Stock = Po = [D1/(1+R)] + [D2/(1 + R)^2] + [P2/(1 + R)^2]
Do = Rs. 4.8/share
D1 = Rs. 5/share
D2 = Rs. 5.5/share
P2 = Rs. 50/share
Value of stock = Po = [5/(1 + 0.12)] + [5.5/(1 + 0.12)^2] + [50/(1 + 0.12)^2]
Po = [5/1.12] + [5.5/1.2544] + [50/1.2544]
Po = 4.46 + 4.38 + 39.86
Po = Rs. 48.7/share
2) Intrinsic value of the bond
Bond Price = C × [1 – (1 + r)^-N / r] +[ P / (1 + r)^N]
Where C is a periodic coupon payment, r is the market interest rate or required rate of return, and P is the par value of a bond. N is no. of periods
Par Value = P = Rs. 1000
Coupon Rate = 10% s.a
Interest Rate = R = 12% p.a = 12%/2 = 6% s.a
Annual Coupon Payment = 1000 x 10% = 100
Semi Annual Coupon Payment = 100/2 = 50
Bond Price = 50 x [1 – (1 +0.06)^-10 / 0.06] + [ 1000/(1 + 0.06)^10]
Po = 50 x [(1 – 0.5584)/0.06] + [1000/(1.06)^10
Po = 50 x 0.4416/0.06 + 1000/1.7908
Po = 368 + 558.40
Po = 926.40
Stock price is undervalued as intrinsic price is Rs. 48.7 whereas market price is Rs. 45/share.
Bond price is undervalued as intrinsic price is Rs.926.4 whereas market price is Rs. 910/share.

MGT201 Assignment No 01 Solution Spring 2019

Below link 

MGT201 Assignment No 01 Solution Spring 2019

MGT201 Solution

below link 

MGT201 Solution


© 2020   Created by +M.Tariq Malik.   Powered by

Promote Us  |  Report an Issue  |  Privacy Policy  |  Terms of Service