Mgt 411 MONEY & BANKING (MGT411) ASSIGNMENT NO. 01

  MONEY & BANKING (MGT411)

 ASSIGNMENT NO. 01

 

 Question: (2*5=10 marks)

 

On the basis of information provided below in a bank’s balance sheet; you are required to calculate following ratios:

 

 Net Profit after Tax

 Return on Equity (ROE)

 Leverage Ratio

 Debt to Equity ratio

 Advances to Deposits ratio

Bank XYZ                                                          Balance Sheet                                                                As at ---------                                                                                                                                                     (Amount in Rs.)       Assets Liabilities     Securities                                     100,000 Deposits                                           450,000     Loans                                           500,000 Borrowings                                      150,000   Reserves                                       50,000                                                       Capital                                          50,000 Total=                                          =650,000 Total=                                           =650,000

 

 Additional Information:

Return on Assets (ROA) ratio of the bank is 4%.

 

 

 

A   A)  Net profit after tax:

ROA=  Net profit after tax/ Bank Total Assets

Net profit after tax = ROA* Bank Total Assets

ROA= 4% =4/100=0.04

Net profit after tax= 0.04*650000=26000

Net profit after tax= 26000

 

     B)  Return on Equity ratio ROE:

ROE= Net profit after tax/ Bank Capital

 ROE = 26000/50000

=0.52

 

      c) Leverage Ratio:

Leverage ratio = Bank Total Assets/Bank capital

 Leverage Ratio = 650000/50000

Leverage Ratio= 13

 

       D) Debt To Equity Ratio:

Debt To Equity Ratio = Total Debts/Bank Capital

Debt To Equity Ratio= 150000/50000

Debt to Equity Ratio =3

 

      v)  Advance to Deposit Ratio:

 Advance to deposit ratio = Total Advances/Total Deposits

Advance to deposit ratio = 500000/450000

Advance to Deposit ratio = 1.1

                                         Best Wishes

 

IT430: E-Commerce Assignment No. 02 Semester Spring 2022

  

Assignment No. 02   Semester Spring 2022

                                              IT430: E-Commerce

 

Solution:

 

 

Sr. No.	E-business	E-Business Model	E-Business Revenue Model	Justification
1	Netflix	Online Entertainment  Model	Digital content revenue	Netflix is one of best production company and entertain the world, no matter where you live. Netflix give you access tv series, documentaries and features films etc.
2	Coursera Inc.	E-Learning Model	Fee for service revenue	Coursera is the E-learning model which provide online course and online certifications etc. Its charge for service revenue.
3	Swiggy	Online Shopping  Model	Fee for transaction revenue	Swiggy is the best platform for offering online restaurants. It is easy way to search to find everything.
4	Marham	Portal Model	Fee for service revenue	Portal model of booking appointment online with  favourate doctor just in one click and its e-business model is fee for service revenue.
5	Hamariweb	Online News Model	Advertising Supported revenue	It is the best plateform for updated news, business and finance update and live cricket update and many more just on one click. This model is advertising supported revenue.

 

MGT201 GDB Spring2022 Virtual Guidance

 

                                                  MGT201 GDB Spring2022

 

1.        Calculation of Intrinisic value of a Bond=?

 

In this case  this is perpetual bond because it is issued for infinite time period.

 

Formula for calculation o intrinsic value of a perpetual Bond

 

V=Interest/required rate

 

Values given

 

Face value=1000

 

Annual coupon=12%

 

Market Price M.P=980

 

Required rate of return(r)=15%

 

Putting values in formula of Intrinsic value of a perpetual bond for calculation

 

First of all calculate interest

 

Interest =  1000 X 12%

 

Interest = 1000 X 12/100

 

Interest = 120

 

V = Interest/required rate

 

V = 120/15%

 

V = 120/15 X 100

 

V = 800

 

MP = 980

 

IV = 800

 

M.P > Intrinsic value

 

Intrinsic value of a perpetual bond is Overvalued.

 

2.        Calculation of intrinsic value of a preferred Stock =?

 

Given values

 

Face value = 80 per share

 

Annual dividend = 10%

 

Market Price = 75

 

Required Rate of Return = 15%

 

Formula for calculation of Intrinsic value of a preferred stock

 

V=D/r

 

V = Dividend/required rate

 

First of all calculate value of Dividend

 

 Dividend = 80 X 10%

 

Dividend = 80 X 10/100

 

Dividend = 8

 

Putting values in Equation

 

V =8/15%

 

V = 8/15 X 100

 

V = 53.33

 

MP = 75

 

IV = 53.33

 

M.P > Intrinsic value

 

Intrinsic value for preferred stock is Overvalued.

 

 

3.        Calculation of Intrinsic value of a common stock with constant growth = ?

 

Given values

 

Face value = 100 per share

 

Last year Dividend D = 10%

 

Growth rate (g) = 5%

 

Market value = 80

 

Required rate of return(r) = 15%

 

Formula for calculation of Intrinsic value of a common stock with constant growth

 

 V = D1/r-g

 

D1 = Next years dividend

 

D1 = ?

 

D1 = D0(1+g)

 

D1 = 10(1+5%)

 

D1 = 10.5

 

Putting values in Intrinsic value eqation

 

V =D1/r-g

 

V = 10.5/15%-5%

 

V = 10.5/10%

 

V = 105

 

MP = 80

 

IV = 105

 

M.P < Intrinsic value

 

So Intrinsic value for common stock is Undervalued.

 

 

Part B Solution:

 

According to calculations of three stocks we have concluded that result that IV of

 

Common stock is preferable.

 

Due to following resons

 

1.      When IV < Market price it is not profitable

 

2.      When IV > Market price it is profitable

 

3.      It is greater that market price ony in common stock case and it is undervalued.

 

4.       So common stock with constant growth is recommended.

 

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