Question

11.) Following are the expected returns from the securities of two companies.
A ltd. and B Itd. under different conditions. Securities of the companies are quoted at Rs100 each.

Condition - Inflation, Deflation, Normal
Probability - 0.3, 0.4, 0.2
Returns of A - 100, 110, 120
Returns of B - 150, 130, 90

Which of the two companies are risky ?​

Answer 1

Answer:

The financial management function

The examiner's style is to test this area of the syllabus as partof a much larger question. Usually, a part (c), or part (d), you willhave to discuss or explain some of the key aspects and theirimplications.

The questions given here replicate that style.

1. Stakeholder groups and corporate governance

Private sector companies have multiple stakeholders who are likely to have divergent interests.

Required:

(a)Identify five stakeholder groups and briefly discuss their financial and other objectives.

(10 marks)

(b)Examine the extent to which goodcorporate governance procedures can help manage the problems arisingfrom the divergent interests of multiple stakeholder groups in privatesector companies.

(10 marks)