Question 1 (50 marks) In classes, we have explained the following importance topics and issues in order to make the most relevant and sensible dual decision in investing and financing for ship investment:

separation of the two roles of shipowner of being pure shipowner/ship investor and/or pure ship operator in ship investment,

interactions of the four shipping markets in different stages of the shipping market cycle,

shipowner/ship investor may have a clear objective and purpose in the chartering arrangement of the ship investment before making investing decision, and

need of dual registration to meet and balance the requirements of the lending bank and satisfy the considerations of minimizing the running cost of the ship.

Requirements:

(a) In your own words and understanding, discuss and explain your understanding of the importance of separating the two roles of shipowner of being pure shipowner/ship investor and/or pure ship operator relevant to the subject-matter of dual decision in shipping and shipping finance. (10 marks)

(b) In your own words and understanding, elaborate and discuss the interactions of the four shipping markets in different stages of the shipping market cycle and how they impact shipping company in considering ship investment. (10 marks)

(c) In your own words and understanding, explain and contrast how the four main types of charterparties guide shipowner in assuming and projecting cashflow of operating activities in the cashflow projection for making investing decision. (15 marks)

(d) In your own words and understanding, explain and discuss the mechanism of dual registration and how dual registration can help shipowner in meeting and balancing the requirements of the lending bank on the one hand and satisfying the considerations of minimizing the running cost of the ship on the other. (15 marks)