MPCF7113 – Final Assessment, CU, Malaysia – Corporate Finance, Case Study

Question 1:

Harry’s father has just bought a lottery ticket and won RM50,000. He plans to invest his money in the mutual funds with the following information:

(a) What is the future amount available on the maturity year of each mutual fund? Critically evaluate if Harry’s father plan to withdraw all money at the 6^th year, which mutual fund should he choose?

(b) If Harry’s father wish to pension in another 20 years with an expected pension amount of RM200,000. His current pension fund earning is 6% yearly. How much money shall he deposit today for the pension fund?

Nonetheless, Harry’s father only has RM60,000 as of today. Based on the answer of Question 1(a), critically evaluate the investment choice of Harry’s father to either invest in mutual fund or pension fund at the 6^th year.

(C) UON bank is currently offering an annual interest rate of 3% compounded monthly for saving What is the future value at the 10^th year if Harry’s father choose to save his RM50,000 in UON Bank. Critically evaluate the risks and return between mutual funds and saving accounts.

Question 2:

(a) Company A is hesitating to issue either cash or stock dividends to their shareholders. As the Chief Financial Officer (CFO) of the company, critically evaluate the reasons of issuing these two types of dividends based on the circumstance of the company in bull and bear

(b) With the emergence of COVID-19, most industries are experiencing a disruption in business that has caused a dramatic decrease in revenue and net profit.

As a finance manager of a Top30 public listed company, which operates in healthcare, automotive and F&B. Critically evaluate your cash flow management during COVID-19 to assist the company to sustain in pandemic.

Answer

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