Task 3: Cost of Capital (30 marks You are working in the finance department and your manager ask you answer the below qu

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Task 3: Cost of Capital (30 marks You are working in the finance department and your manager ask you answer the below questions. Sainsbury is financed by both debt and equity. You need to collect the following information and calculate the weighted average cost of capital (WACC) of Sainsbury. 1. Include the Market Cap of Sainsbury. [5 marks] 2. Include the Long-term Debt of Sainsbury. (From the recent released balance sheet of company) [5 marks] 3. Discuss the Beta of Sainsbury as measure of systematic risk. [5 marks] 4. Discuss the 10-year Bond rate of UK government as proxy of risk-free rate. [5 marks] 5. What is the weighted average cost of capital (WACC) of Sainsbury? (Hint: according to IG market, the average of recent yearly returns of FTSE 100 as proxy of UK market is 7.5%; UK corporate tax rate is 19%). [10 marks] Task 4: Risk and Return (30 marks You can choose the company of your choice and extract the month price of the company and S&P 500 and show the results of the following items: 1. Show the monthly return of the company and S&P 500 in the same graph. What is your interruption interpretation of the change of return of the company comparing with the market index? [15 marks) 2. Calculate the monthly standard deviation and return for both the company and S&P 500. What is your interruption of the risk and return of the company comparing with the market index? [15 marks)
Task 1: Project Appraisal [40 marks Jackets Ltd is considering expanding its highly successful denim jackets business. The initial investment costs and net annual cash flows for two projects considered by Jackets Ltd manufactures denim jackets are shown in the table below: Year 0 1 2 3 4 A (100,000) 20,000 25.000 35,000 50,000 B (150.000) 100,000 40,500 20,000 10,000 The company's expected return on capital is 8%. For both projects, calculate the following: 1. Calculate the ARR and discounted payback period of these two projects. [10 marks] 2. Calculate the NPV of these two projects. [10 marks] 3. Calculate Profitability index for these two projects. [10 marks] 4. Considering the above results, explain critically which project do you choose? [10 marks) Task 2: Investment Opportunities [30 marks You are working as a financial advisor for Bradford financial Services Ltd based on Leeds Road which has clients from the public and private sector around the Yorkshire region. Mr John who is 30-year old which is one of your client. He recently received £30,000 from his family and wants to invest this fund for at least 25 years. He has a job with saving of £800 per month. He comes to you as his financial advisor seeking for investment advice. 1. Suggest a list of potential investments opportunities for Mr. John. [15 marks] 2. Keeping in view of his age and financial condition, what is your financial advice? [15 marks]Hint: consider different investment options in money and capital market.