CIMA Related Exams
F3 Exam
The CIMA F3 exam syllabus encompasses a wide range of financial strategy concepts, including:
The CIMA F3 and P3 exams are part of the Strategic Level of the CIMA (Chartered Institute of Management Accountants) qualification, but they focus on different areas:
CAPM:
E(R)=Rf+β(Rm−Rf)E(R) = R_f + \beta (R_m - R_f)E(R)=Rf+β(Rm−Rf)
Given:
E(R)=11%,Rf=2%,Rm=8%E(R) = 11\% , R_f = 2\%, R_m = 8\%E(R)=11%,Rf=2%,Rm=8%
0.11=0.02+β(0.08−0.02)⇒0.11−0.02=0.06β⇒0.09=0.06β⇒β=1.50.11 = 0.02 + \beta(0.08 - 0.02) \Rightarrow 0.11 - 0.02 = 0.06\beta \Rightarrow 0.09 = 0.06\beta \Rightarrow \beta = 1.50.11=0.02+β(0.08−0.02)⇒0.11−0.02=0.06β⇒0.09=0.06β⇒β=1.5
Beta > 1 ⇒ higher risk than the market.
An unlisted company:
Is owned by the original founder and member of their families.
Is growing more rapidly than other companies in the same industry.
Pays a fixed annual divided
Which of the following methods would be the most appropriate to value this company’s equity?
A company currently has a 5.25% fixed rate loan but it wishes to change the interest style of the loan to variable by using an interest rate swap directly with the bank.
The bank has quoted the following swap rate:
* 4.50% - 455% in exchange for Libor
Libor is currently 4%.
If the company enters into the swap and Libor remains at 4%. what will the company's interest cost be?