Section C (4 Mark)
Read the senario and answer to the question.
Assume the following additional facts:
The Shankers have purchased a homeowner's policy (comprehensive) covering 100% of the replacement cost of their residence. This policy has a Rs. 500 deductible. Also, they have purchased a disability income policy with a 30-day elimination period and an any-occupation definition of disability.
What actions should the Shankers consider in order to improve the quality of the insurance program described above?
Section C (4 Mark)
Read the senario and answer to the question.
During identification of new business opportunities, one of Harish's friends Shekhar has offered him a business proposal. In this proposal a partnership firm consisting of two partners, Harish and Shekhar, shall take the franchise of a company which is a reputed brand in the field of pathology lab in which their investment and profit sharing ratio shall be equal.
Franchise rights shall be valid for 5 years and the project requires an upfront investment of Rs. 25 lakh for required infrastructure. The franchisee agreement has an option that the company can take over the franchisee after 5 years by charging depreciation @15% p.a. on straight line basis.
The projected profits from the firm are as follows:
Harish wants to know what IRR he will earn on his investment from this project ? (Please ignore taxes and assuming no additional investment is made during this five year period)
Section C (4 Mark)
Read the senario and answer to the question.
Saxena is considering an attractive investment proposal in which he is being offered two different cash flow choices at the same initial investment of Rs. 2,00,000. According to you which one should he opt for assuming Risk Free Interest Rate is the required rate of return?
Section C (4 Mark)
Read the senario and answer to the question.
Mr. Adhikari bought agricultural land in Patna in 94-95 for 1.75 lakh. That land was vacant for last so many years. But due to establishing a ''Commercial Processing Zone'' the Bihar Government has issued a notice for compulsorily acquirement on 12/08/2003. In 2006 government has fixed compensation for Rs. 6.50 lakhs and acquired it on 09/01/2006. Rs. 2 lakh was received by Mr. Adhikari on 07/03/2006. Mr. Adhikari and others were not satisfied with the compensation and file a suit in the court.
Balance compensation paid by Bihar Government on 08/10/2008. The compensation is enhanced by another 1.50 lakhs by the Bihar Government which paid by the Government on 11/12/2008.Compute Capital Gain tax in the hands of Mr. Adhikari for the assessment year 2009--10.
Section C (4 Mark)
Read the senario and answer to the question.
Saxena is considering an attractive investment proposal in which he is being offered two different cash flow choices at the same initial investment of Rs. 2,00,000. According to you which one should he opt for assuming Risk Free Interest Rate is the required rate of return?
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