Question: b) Analyse the primary financial risks the company faces, and explain how might these might affect its future growth. (8 marks) QUESTION 3 (15 marks)

b) Analyse the primary financial risks the company faces, and explain how might these might affect its future growth. (8 marks) QUESTION 3 (15 marks) a) Explain the role of time value of money in investment decision. (4 marks) b) Jack, the financial manager of the Parkson Store, was offered the chance to purchase the right to receive $1,900 royalty payment nine years from now. The offer came from the owner of the LotusCompany. Jack believes that if he had the $1,900 in hand now, he could invest it and earn 8 percent. How much is he willing to pay now for the right to receive this royalty payment? (4 marks) c) In 10 years, Nadia and Nabil are planning on going for trip to Istanbul. The trip is currently cost $30,000 and is expected to increase in value each year at a rate of 2%. For that, they have made an investment. Assuming they can earn 10% annually on their investment, how much must they invest at the end of every year for the next 10 years to be able to achieve their dream? (7 marks)

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