Question

QUESTION 1 (15 marks) GAME Stores is a promotionally driven discount retailer of predominantly general merchandise and non-perishable groceries for home, leisure and business use. The first GAME store opened in Durban, South Africa, in 1970 and it has grown to have 110 stores in 12 African countries. GAME operates in Namibia as well. It has stores in Oshakati, and two in Windhoek (le Grove Mall and Windhoek Game Centre). Game is a subsidiary of Massmart Holdings. Massmart is Africa's third largest distributor of consumer goods and it is listed on the Johannesburg Stock Exchange (JSE). (http://www.game.co.za). Assume that you have been appointed as the financial manager of Game Stores throughout Namibia 1.1. Identify some specific investments decisions which you may be called upon to make? (10 Marks) 1.2. Explain five common errors Investors commit in managing their investments (5 Marks) QUESTION 2 (20 Marks) 2.1. What is the present value of a 27-year annuity due. If the annual interest is 5%, and the annual payment is $2,0007 (5 Marks) 2.2. What is the future value of a 20-year ordinary annuity, if the annual interest is 8%. and the annual payment is $1,500? (5 Marks) 2.3. What will a deposit of $4,500 at 10% compounded semi-annually be worth if left in the bank for six years? (5 Marks) 2.4. What will a deposit of $4,500 at 12% compounded monthly be worth at the end of 10 years? (5 Marks) Question 4 DE THOMAS (14 Maria

Answer 1

2.1
=2000/5%*(1-1/1.05^27)*1.05=30750.37060199

2.2
=1500/8%*(1.08^20-1)*1.08=74134.3821629485

2.3
=4500*(1+10%/2)^(2*6)=8081.35346709958

2.4
=4500*(1+12%/12)^(12*10)=14851.7410255815