INTERNATIONAL ISLAMIC UNIVERSITY ISLAMABAD S FACULTY OF 4 DEPARTENT OF Mid-Term Examination Spring 2021 Course Title: FINANCIAL MANAGEMENT | Course Code: FIN 302 Program: Batch: Total Marks: 20 MARKS Date & Time: 16-April-2021 (08:00 a.m.) Credit Hours: 03 Teacher Name: MISBAH WADO oD @. No. Marks Obtained 1 2 Total Marks Student's Name: Ayesha chaudhary. Student's Registration Number: 5535-FMS/BBA/S19 Instructions for Students: Before starting your examination, please read and follow all the given below instructions carefully. You must affirm the honesty pledge given at the end: 4. Download the question paper titled as “eName of the Course> Question Paper.pdf" (pdf f | e) and answer-sheet titled as “_Answer-Booklet.docx" (MS Word doc ument) fromthe Google Classroom as per instructions of your teacher. You are required to write down the answersto each question in your own handwriting on neat white papers with blue pen. 2. Maximum time to download question paper, attempt and submrit/ upload your answer shee tsis3 HOURS, As soon asyou finish your paper, upload your answer booklet on priority basi s 3. Youcan only upload your exam response ONCE. You will not beable to re-upload an addition Page 1of(Lys INTERNATIONAL ISLAMIC UNIVERSITY ISLAMABAD FACULTY OF L DEPARTMENT OF al or amended version. If you fail to submit it within the due time, your paper shall be considered cancelled. 4. Howto submit(upload) your answer-booklet/paper. After completing your answers, you need to: & Mention your Name, Registration Number, Page number and sign each page of you Thandwritten answer-sheet. b. Take pictures using mobile camera or Scan each page of your written answers /ans wer sheets via any scanning software (ike, Camscamer). ©. Insert all pictures or scannedimages of your answer sheets into the MS WORD f le tit led as “_Answer-Booklet.docx” provided by the teacher in the Google Classroom d. After inserting all the images, save the “_Answer Booklet. doc x" fle as a single POF fle (Only PDF format is acceptable as your answer-booklet), and upload it in the Google Forms (link of which is provided in the Google Classroo m). e. Please make sure you upload the correct document as you will not be able to change this, onceit has been submitted (Please see the video tutorial regarding procedure to upload the examination respon ses, shared in the Google dassroom and LMS, accessible on the link (https'//Ims liye du.pk/attempt-via-computer mp4) for students using Computers for attempting Exa mination paper and on the link (hitps-//Ims jiu edu pk/attempt-via-mobile mp4) for st udents using mobile devices for attempting Examination paper). 5. TheUniversity views copying from one another's examination paper/ cheating, giving or receiv ing unpermitted aid, discussion’ consultation, plagiarism, impersonation and submission of ex amination responses/answer sheets through the ermail IDs of other students as serious discip linary offences, that fall under the category of Use of Unfair Means and will be dealt as per u niversity rules for Unfair Means Control Committee (UMCC). 6. Before you start the paper, you must agree to and sign the following pledgeby clicking on the Student's Af fmation checkbox (it is mandatory to Tick the Checkbox): (In case a student d oes not find the option to tick mark the checkbox, he/she can simply write down ‘Yes’ in the pl ace of checkbox). “Thereby af fm that i) | shall solve this paper on my own and I shall not seek the h elp of any person(s) with any sort of aid (like telephonic/verbal help, attempt ed answers related to my examination etc.) while taking my paper, (ii) or will not provide assistance of any sort (verbal or written) to other fellow student s. If 1am found involved ini) cheating ii) impersonation, iii) or using plagiarized c ontent in my writing, my case may be dealt as per university rules and procedures for using unfair means." Page 2 of J{ wo. = Eid. tr i M meni Date 16-4- 202) Nome: Auesha Chaudhery = ‘| Rem 5535-Fms\a@a |siq ~ peA-voR i Subt» Financial! Menagement ____| Submitted te: _Mexna Misha — Wedesd -_ Mid Terma Exams 202] Ans: | CAPM Model with the_he! , SML_& CmL:: CAPM _is defined as my taf Asset Putcing Moecle("s Its a foneruta _wihich describes the relahonshie bekuacn the susternalic —sisk fa secunby (cr a _ ct folio pack expected sehun | JE girs shes e the! — ox beta _ fo cthers an compared éf a_s aiky zelat fe the sues mcakel- | RRR = RE + (Rm RB the CAPM fownuUa ts the visk free vale ef vehim added to the bela of the security or portfolio multiplec! by. the € «eck moarke wehinn rnious tHe yriskfree wate of qetugn- CML: CML is defined as_Choractershe Market —— ___Line. a as == SML: Smits defrnecl_as Sectertty praskeé a line which _ clésplays the expected rehux0_ of a Sécurthy or pong: 7 athe capri coy Hare ae | Seab esental on_—F a — 20-} a be & — Zz SMe s_a_Léée —chrawa—aih_at tehaes fff —————= Ss Seyves* a5 2a een ¥ejn om nlm a im mie INDifferent _ty are “uy certain, "Risk" me heve ee aos a. hy pees t 1% -< risk te i> when theze 7 é 2! sleome_is_linown ‘aj risk :- G pie Uncle verifiable Ris. | chtvercifiiable Risk - Stanol Se k oa Risk. A er le Un ‘Avocet! e aie ¥. | —binsipsteusreulic— “4 Diversifiokle Risk: Diversifiable aisk, the risk. Of price change due fo the unique rakuses. cafe ee Pthe pastiat er secunily anal’ se not dependent fen the overalt__anaskel con ditions. Divessifiable vex can be elemindtecdl hy clcversification in the portfolio: Non-diversifiable Risk: rb assels_ov is the ent ye clo of! sisk Common to Ihe liabileties-WAY levh qh! wy wn ae foul Li stock A fockB = ro 1 Let Stock A Stock& : “ 2 iy —5y, lov. ‘ o-€ 20 f- IS» : o= 2 Yo. hey. a STand_Alone Risk for Stock As Ky | Pp x Kee | 0-05 o-2 0-05%6+20-00)| =o 24 0:20 o-6 _ 0:18 O-0t 0- 4O o:2 0-08 o- al ~ ‘= zv.0/9 | i. lay.== 1p ly 3 @ _0- 0152 ©- 0cooG o-00 992 2 (x-@n) ps 0-6204 For Steck 8: —_ 7 = 7 P x Kg 8x | (px a2 o-loro220:02| -0-95 0-002 o» 6 0709 ° t oO oO? 0-04 +0-05 +0025 Bx 20215 | 2 157. = gob y : , p(x —4%) a V*g.000 5 x= Vv £p(x,~ee)* oO : o-do / 0:000 5 = 00316 | p(x -2F) 2000!— _| FoxtFolio Risk withh Sof snvestment_in_each: — ____K x 2 x —_ _ eos is. See PES) 0-02 E ols ©-6 (o-2)(o-S) + (0-15 Wo'5) = oS _- Pe.2 O2 (o-wfo-5) 4 fo-2 os) = 0-3 = = — z _ 2 P x v- 5x (xox) Plex) E a o-2 0-005 -0-145 ©-021 ©0042 . O-71TS | o+e o-105 22005 0.000025 0 0cc0l5 7 Or2 020 ota 6 -016F © +602238 & Sx =0-1T PTL 2117p. 2 0.00157 ¢ RQ Ota fo eu x ny Expected Rehirn Risk 7 A f Tt 4y. 14 f _ _B BYE Beth As A (stock A) has its bighes_value ef tsk euncl expected! vwehan 86 accoroling to visk averse. £ woul preker clack A-: « Date 2 “16, 020, OOO les 260,000 ot — R000 ,O6O 4 _= 5,080 ,c00 3, = !FQ00, CoO _ RRs +30 + AFn = ee i | 6s 04) (far) Ss S 2 [\fieee, coo 2 10) = (Biccg,c0 'B doo, ( J = 16 ,ce8 600 1G) eco yee’ ote E = = o-66 = (l5,c00 00°) (0-30) AFN = 10,5) 600 ns. Percentage ef Soles Method: Sales Cyscwth Med hod: 7 (_Cumeat Sales — Previous Sabes)tlog Provious safes _? (Beco cc ~ 16: 000,000) ¥ foo 16 000,000 : o-8T5 x loo e754 yyeS 2 , c \8 I Roy PW YY \\ fe eae “Jonieeo! x1eo = 6-07 1o001B00 Lament Assets for nent year 7 = —f-< Cunent Yeo” Assets” ) x estimalecl_sale cument year Sales gre wth vate - 2ow,om xX 0-29 7 Yoo,000 _Ulins. Que | ~ - = Perkb » Qe yj ks 2 : - RRRz RE + (Rn-Rf) 2 ——2e7$p fo.04 1.2) = 49-37, lr on) re ley TOL) OY ™ yy Ui yy |() wo. ——————— ee ee jae = > dD, CI+9) BoD ara - 2 a4 (1-2) —T af r2d C3 7 28 Sos - Dy (2) : ae ie Ss “3 Cis0:63) S(t: o2) = 30: oF) ae = ° = fa - P. = DY = i =. 3-2 o123— o:0F 2 3-2 G:053 = 6 Py2_ fy (i+e)? Pus Pv. r _ _ Py 2 ae (+0123)! (| +0 +123)" a-13 : = A-2\ fle | WAN WN adn rhhy rte | ; {|| El Pl ddd) )) be ) | 4 1) rd F 1 | | } bss 1 VM WAAR, | | eee