DEC 2008

[asadkhalid]

Can someone discuss question 1 with me here? I still don't how to calculate the price of the share using P/E ratio? The was no P/E ratio given in the question??

Overall, the entire paper was way over my league!

[jnrp2000]

I totaly agree with you. Even Q 4 also difficult

[claudia2280]

I calculated first the P/E for the current year.
The price per share was given and as earnings per share I used the figure given for 2007.

The question said the P/E stays constant. To calulate the price per share I took the P/E as calculated above. To determine the earnings per share I calculated the growth for the four years given and then calculated with the growth rate the earnings per share for the following year. This EPS I used together with the P/E ratio to calculate the share price.

However, I have no idea if this was the right way. It was just the only way I could think of.

[Jaica]

Hi there,

I also calculated the P/E ratio by using current year(2007?) information.

But also not sure whether question is asking about share price after right-issue in 2007 (Consider only for dilution) or 2008 (Consider EPS of 08 and dilution).

Question 4 was horrible for me...... run out of time too there....

[registoni]

I calculated first the P/E for the current year.
The price per share was given and as earnings per share I used the figure given for 2007.

The question said the P/E stays constant. To calulate the price per share I took the P/E as calculated above. To determine the earnings per share I calculated the growth for the four years given and then calculated with the growth rate the earnings per share for the following year. This EPS I used together with the P/E ratio to calculate the share price.

However, I have no idea if this was the right way. It was just the only way I could think of.

I did the same, but as P/E is constant and EPS is growing at constant rate I got the market value = current market value (2.50 as far as I remember) there si similar question in the past DEC 2004 Q3 http://www.accaglobal.com/pubs/students/study_exams/qualifications/acca_choose/acca/professional_scheme/part2/paper2_4/exam_papers_professional/2-4_2004_dec_a.pdf

[gwenie]

I totaly agree with you. Even Q 4 also difficult

i have no idea how to get the p/e, by reading this though i take comfort that i was not the only one! i got the growth per year by doing the eagr calculation, 4 by square root, brackets earliest/most recent divided by lastest/old oldest. got €2.50 too i think, couldnt get the p/e tho! question four was an absolute nightmare of a question, i couldnt make head nor tail of it, i didnt know what base currency we were in!
i had learned how to do the money market hedging, forwards, lead payments but i just couldnt figure out the question to know what to use and hadnt time to think about it so did the theory and that was it.
fairly upset after exam as thought i had prepared enough for it going into the exam...obviously not :(
id say i got 15% on the whole paper if even that

[Candice Clavery]

i am at a lost, i thought i finally passed this exam after three tries, i must go at it again. I got 40 this time, the most ever. where to start?