I sort of rushed this paper and gave up towards the end. Having done Sept 2000 beforehand I felt that that was much easier than April 2001. The things that I got stuck on were: the rate of discount question (I'm only used to dealing with rate of interests), time weighted rate of return (not too sharp on that yet), forward contract (this question had a 'special dividend' included in which threw me off), proving the price formula (got half of it right), the net present value question (because I didn't know how to value the outgo properly) and everything on the index linked bonds (yeah I kinda need to look at that lol). This paper threw together every topic that I like to shy away from. Well at least I know what to work on now! What mark would you say would have been the boundary to pass relatively comfortably for this particular paper? Thank you.
Hi I hvnt done Aprill 2001 paper. However, What all past year papers you planning to do? (I was thinking 2005-2009 is enough)
I remember finding those papers from back then harder than the ones being written now, but if you know the course well it really shouldn't be a problem since you can figure it out if you think about the question a bit harder. Also note there have been some changes to the course, eg Decreasing annuities are now not on the course (Instead you add an increasing annuity). Also variable annuites have been scrapped. Also questions like that price formula should be easy marks, if you know your infinite geometric series well, theres really no tricks involved there.
Yes actually looking through the solutions now the paper doesn't seem that hard afterall! I guess I made it harder by thinking it was harder. That price formula was actually alright (looking back on it), I got half of it right then somehow decided that I'd got it wrong and gave up on it. In fact there's another question where I got the bits I worked out right but just didn't follow through with it. Really need to stop doing that. Also I must remember not to cross out my answers when I think I've got it wrong!
I was going to do all of them but then last night I realized how many there were! So I'm pretty sure I'm going to skip quite a few of them but I don't know which ones yet. As people are saying the earlier ones are harder I'm thinking of tackling those first and then using the newer ones as mocks possibly.
The examiners solution is actually incorrect unless the special dividend is per shareholder rather than per share. Though you'll discover the corrected solution to this question in the Q&A Bank. We advise students for 65% though it may be lower for more difficult papers.
Yeah I wondered why the Q and A had a different answer. I just put it down to rounding. Either way I didn't really understand it anyway. The QandA gave a really long way of getting to the answer and the solution in the exam only had 1 line.
