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ACFI3310

2018/2019

Business and Law

ACFI3310
Advanced Corporate Finance
08 May 2019
2 hours
09.00 11.00

Answer ALL questions in SECTION A on the EDPAC form provided

All questions carry equal marks.

Answer TWO questions from SECTION B.

All questions carry equal marks.

Formulae and tables are provided on pages 13-21.

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Completing your EDPAC Sheet

Please check that the EDPAC sheet that you have been issued is
headed Faculty of Business and Law.

Please complete the EDPAC answer sheet using an HB pencil.

‘Module Code’ Box – please write the code of your exam which is
included in the top right hand corner of your exam paper.

‘Date’ Box – please write today’s date in this box.

‘EXAM NO’ Box – please leave blank.

‘CANDIDATE’S P NUMBER’ Box - Enter your DMU Student ID number

in the boxes provided (ignoring the P).

If you do not know your candidate number please ensure you write
your full name on the back of the EDPAC sheet.

ANSWERING THE QUESTIONS

Mark your answers by putting a clear heavy horizontal line like this: [▬]
within the [ ] space provided for each question. DO NOT use a faint line
[—], a tick [√] , a cross [x] or a circle [o]. DO NOT mark outside the area
defined by the brackets [ ]. Your responses need to be clear. If you
make a mistake, erase your previous answer.

For each of the 10 questions in Section A of this exam paper there are 4
choices available to you. These choices are marked by four letters A, B,
C and D. You must choose only one. Questions which are answered
using more than one choice will be marked as being incorrect.

For Section A, only questions answered on the EDPAC form will be

marked. Unclear responses will be awarded zero marks.

No marks will be deducted for incorrect answers or omissions.

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Section A: This section is compulsory.

Attempt ALL questions from this section. All questions in this

section are worth three (3) marks each and the section is worth
thirty (30) marks in total.

Question 1 - Which of the following represents Modigliani and Miller’s

(M&M) proposition 1 on the effect of capital gearing on Weighted
Average Cost of Capital (WACC)?

A. There is a negative relationship between financial gearing and the

WACC because of the tax shield
B. There is a positive relationship between financial gearing and the
WACC because of financial distress
C. There is no relationship between financial gearing and the WACC
as there are no tax benefits from higher gearing
D. There is a positive relationship between financial gearing and the
WACC because of the increased volatility of the ROE

Question 2 - A company with 70% gearing is currently worth £30 million.

It plans to issue more equity to payback the debt. It has 12 million shares
outstanding. The corporate taxation rate is currently 25%. Under M&M
proposition 2, what should happen to the share price? Assume the only
market imperfection is corporate taxes.

A. It should fall
B. It should increase
C. It should remain unchanged
D. It is impossible to state.
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Question 3

The following picture depicts:

A. Modigliani & Miller proposition without taxes and without

bankruptcy risk
B. Modigliani & Miller proposition with taxes and without bankruptcy
risk
C. Modigliani & Miller proposition without taxes and with bankruptcy
risk
D. Modigliani & Miller proposition with taxes and with bankruptcy risk

Question 4 - Elegant Cakes company has no debt and its weighted

average cost of capital is of 8.40%. The average debt-to-equity ratio for
the industry is 0.12. What would Elegant Cakes’ cost of equity be if it
took on the average amount of debt for its industry at a cost of debt
before tax of 4%? Taxes are charged at 25%.

A. 8.93%
B. 8.74%
C. 8.80%
D. 8.40%
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Question 5 - You have sold a call option with a strike price of 112
pence. The bid price was 2 pence. If the actual share price is 108 pence
on the day of expiry, what profit (or loss) will you have made?

A. 6 pence profit
B. 2 pence loss
C.2 pence profit
D. 6 pence loss

Question 6 - What is displayed in the diagram below?

A. Payoff diagram for the buyer of a call option.

B. Profit diagram for the buyer of a call option.
C. Payoff diagram for the buyer of a put option.
D. Profit diagram for the buyer of a put option.

Question 7 - Company X has a present value of £123 million and

Company Y has a present value of £58 million. Merging the two would
enable cost savings with a present value of £17 million. Company X
acquires Company Y for £72 million. What do Company X’s
shareholders gain from this acquisition?

A. Nothing; the gain all goes to Company Y’s shareholders

B. £3 million
C.£14 million
D.£17 million
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Question 8 - Which of the following IS NOT a method of valuing a

company for acquisition?

A. Book value
B. P/E ratio valuation
C. Smooth valuation
D. Free cash flow valuation

Question 9 - In general, investors interpret the announcement of an

increase in dividends as:

A. Bad news and the share price drops.

B. Very good news and the share price soars.
C. A non-event that does not affect the share price.
D. Good news and the share price increases.

Question 10 - Carnegie plc has 850,000 shares outstanding. Its

earnings are £4 million this year and it expects to pay all of it as a
dividend. The required rate of return is 6%. From next year onwards it
expects to earn £5 million what would the share price be today?

A. £98.04
B. £4.71
C. £176.47
D. £102.75
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Section B: Attempt TWO (2) questions only from this section.

All questions in this section are worth thirty five (35) marks each
and the section is worth seventy (70) marks in total.

Question 11 - Capital structure

Hanns plc (Hanns) specializes in the development and assembly of high

quality boats. The business is considering a new project which is the
development of a car production plant. The new plant will specialise in
car production and it is an entirely new line of business for Hanns. The
Finance Director has been asked to evaluate the project.

The investment is expected to cost £350 million immediately and to

receive cash inflows, after tax, of £100 million per year for years 1 to 5.

The investment will be financed 50% by equity and 50% by debt, which
is in line with Hanns’ previous capital structure.

Hanns’ current weighted average cost of capital is 12%, and their pre-tax
cost of debt is 2%. The rate of corporate tax is 30%. The market return is
8% and the risk-free rate is 2%.

The Finance Director has obtained the betas and debt ratio of a proxy
company, Good plc. These are:

Equity Debt Debt ratio

Beta Beta (debt: equity)
Good plc 1.13 0 3:2
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REQUIRED:

a) Calculate the risk-adjusted WACC for Hanns using Good plc as

a proxy.
(15 marks)

b) Calculate the NPV for the project, using the risk-adjusted

WACC as the cost of capital. Suggest whether the project
should be accepted.
(5 marks)

c) Discuss the limitations of using risk-adjusted WACC and

describe an alternative approach which could be used. Explain
why this might be a better approach.
(15 marks)
TOTAL 35 MARKS
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Question 12 - Dividends

Blades plc. (Blades) has usually followed a residual policy when it comes
to paying dividends. The company directors have been considering
changing policy and the following calculations are required to assist the
analysis of this proposal.

Blades has the following forecast cash flows for the next 5 years, as well
as possible additional cash flows to consider:-

NB: All forecast cash flows have been calculated before the deduction
of additional investment in fixed capital and working capital. All additional
investments have been forecast to have a positive NPV.

Year Forecast cash flow Additional investments

£’000 £’000

2019 8,800 6,800

2020 11,100 8,750

2021 14,300 11,300

2022 17,500 14,100

2023 19,100 15,600

Table 1 – cash flows and investments for Blades plc (2019-2023).

There are currently 6,500,000 shares in issue.

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REQUIRED:

a) Calculate the annual cash flows available for dividend

payments and the dividend per share if the residual policy was
strictly adhered to.
(5 marks)

b) If Blades chose to have a smooth dividend policy based on

maintainable regular growth what would you suggest the
dividend per share and the total dividend payment each year
should be?
(12 marks)

c) Following your calculations in (b), calculate the cash flow

available to Blades for a share repurchase or a special
dividend for each year.
(5 marks)

d) Using your calculations from parts (a), (b) and (c) evaluate
whether Blades should change from the residual policy to the
smooth dividend policy. Your discussion should include how
the special dividend or a share repurchase might be used.
(5 marks)

e) One board member said “the pattern of dividend payments is

irrelevant and so the change of policy is not necessary”.

Evaluate the board member’s statement.

(8 marks)
TOTAL 35 MARKS
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Question 13 - Mergers and Acquisitions

Scrum plc (Scrum) is considering an offer to purchase Down plc.

Scrum’s Finance Director has obtained the following information:

Scrum plc Down plc

P/E ratio 14.2 6.5
Shares outstanding 2 million 600,000
Earnings (£) 5 million 720,000
Total Dividends (£) 500,000 140,000

Scrum understands that a merger with Down plc could lead to

synergistic benefits of 5% of the value of the combined present values of
the individual companies. Though, with further efficiency measures, this
could increase to 12%. Down plc is a relatively new organisation, and
still quite small, comparatively.

The companies are both in the leisure industry but offer different
services and are not, therefore, direct competitors. However, they share
some competitors who offer a wider range of services. The leisure
industry has an average P/E ratio of 8.3, with a range of 3.2 to 21.7.

REQUIRED:

a) Establish, with supporting comments to explain your method,

the market value of both Scrum plc and Down plc before the
market is aware of the proposed purchase.
(10 marks)

b) Discuss the potential benefits of the acquisition to Scrum plc.

(10 marks)

c) Suggest a range of prices that Scrum plc might consider

paying for Down plc? Suggest, with reasoning, which you
would consider to be the most appropriate.
(15 marks)
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TOTAL 35 MARKS
Question 14 - Options

A call option is being offered on Tigers plc with a strike price of 87.00
pence and a time to expiry of 12 months. The current price of Tigers
plc’s shares is 84.00 pence. The historical standard deviation on the
shares’ return has been 7%.

The annual risk-free rate is expected to remain at 1.5%.

Tigers plc does not pay dividends.

The share price is expected to rise by 11% or fall by 3% in the period.

REQUIRED:

a) Use the Black-Scholes option pricing model to calculate the

price of the call option for Tigers plc. Explain any limitations of
using this pricing method. (work to 2 decimal places throughout,
with the exception of N(d1) and N(d2) which should use the full value
from the tables)
(15 marks)

b) Using the put-call parity theory, calculate the price of the put
option.
(5 marks)

c) Use the Binomial option pricing model to calculate the price of

a twelve-month call option for Tigers plc, with a strike price of
87 pence.
(10 marks)

d) Discuss, with reasons, what should happen to the call and put
prices if the strike price was higher (but all other factors
remained the same).
(5 marks)
TOTAL 35 MARKS
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FORMULAE

or

DVM where

(no growth)

Modigliani and Miller

Without tax With Tax

Or Or
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CAPM

Beta

Options

Company Valuation
Price Earnings Ratio = Share price / Earnings Per Share
Constant growth:
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or

Non-constant growth:

Or
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TERMINOLOGY

(required
return of all capital)

of return
PRESENT VALUE of £1 at i% and n periods

1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15%

1 0.990 0.980 0.971 0.962 0.952 0.943 0.935 0.926 0.917 0.909 0.901 0.893 0.885 0.877 0.870 1
2 0.980 0.961 0.943 0.925 0.907 0.890 0.873 0.857 0.842 0.826 0.812 0.797 0.783 0.769 0.756 2
3 0.971 0.942 0.915 0.889 0.864 0.840 0.816 0.794 0.772 0.751 0.731 0.712 0.693 0.675 0.658 3
4 0.961 0.924 0.888 0.855 0.823 0.792 0.763 0.735 0.708 0.683 0.659 0.636 0.613 0.592 0.572 4
5 0.951 0.906 0.863 0.822 0.784 0.747 0.713 0.681 0.650 0.621 0.593 0.567 0.543 0.519 0.497 5
6 0.942 0.888 0.837 0.790 0.746 0.705 0.666 0.630 0.596 0.564 0.535 0.507 0.480 0.456 0.432 6
7 0.933 0.871 0.813 0.760 0.711 0.665 0.623 0.583 0.547 0.513 0.482 0.452 0.425 0.400 0.376 7
8 0.923 0.853 0.789 0.731 0.677 0.627 0.582 0.540 0.502 0.467 0.434 0.404 0.376 0.351 0.327 8
9 0.914 0.837 0.766 0.703 0.645 0.592 0.544 0.500 0.460 0.424 0.391 0.361 0.333 0.308 0.284 9
10 0.905 0.820 0.744 0.676 0.614 0.558 0.508 0.463 0.422 0.386 0.352 0.322 0.295 0.270 0.247 10
11 0.896 0.804 0.722 0.650 0.585 0.527 0.475 0.429 0.388 0.350 0.317 0.287 0.261 0.237 0.215 11
12 0.887 0.788 0.701 0.625 0.557 0.497 0.444 0.397 0.356 0.319 0.286 0.257 0.231 0.208 0.187 12
13 0.879 0.773 0.681 0.601 0.530 0.469 0.415 0.368 0.326 0.290 0.258 0.229 0.204 0.182 0.163 13
14 0.870 0.758 0.661 0.577 0.505 0.442 0.388 0.340 0.299 0.263 0.232 0.205 0.181 0.160 0.141 14
15 0.861 0.743 0.642 0.555 0.481 0.417 0.362 0.315 0.275 0.239 0.209 0.183 0.160 0.140 0.123 15
20 0.820 0.673 0.554 0.456 0.377 0.312 0.258 0.215 0.178 0.149 0.124 0.104 0.087 0.073 0.061 20
25 0.780 0.610 0.478 0.375 0.295 0.233 0.184 0.146 0.116 0.092 0.074 0.059 0.047 0.038 0.030 25

0.160 0.170 0.180 0.190 0.200 0.210 0.220 0.230 0.240 0.250 0.260 0.270 0.280 0.290 0.300
1 0.862 0.855 0.847 0.840 0.833 0.826 0.820 0.813 0.806 0.800 0.794 0.787 0.781 0.775 0.769 1
2 0.743 0.731 0.718 0.706 0.694 0.683 0.672 0.661 0.650 0.640 0.630 0.620 0.610 0.601 0.592 2
3 0.641 0.624 0.609 0.593 0.579 0.564 0.551 0.537 0.524 0.512 0.500 0.488 0.477 0.466 0.455 3
4 0.552 0.534 0.516 0.499 0.482 0.467 0.451 0.437 0.423 0.410 0.397 0.384 0.373 0.361 0.350 4
5 0.476 0.456 0.437 0.419 0.402 0.386 0.370 0.355 0.341 0.328 0.315 0.303 0.291 0.280 0.269 5
6 0.410 0.390 0.370 0.352 0.335 0.319 0.303 0.289 0.275 0.262 0.250 0.238 0.227 0.217 0.207 6
7 0.354 0.333 0.314 0.296 0.279 0.263 0.249 0.235 0.222 0.210 0.198 0.188 0.178 0.168 0.159 7
8 0.305 0.285 0.266 0.249 0.233 0.218 0.204 0.191 0.179 0.168 0.157 0.148 0.139 0.130 0.123 8
9 0.263 0.243 0.225 0.209 0.194 0.180 0.167 0.155 0.144 0.134 0.125 0.116 0.108 0.101 0.094 9
10 0.227 0.208 0.191 0.176 0.162 0.149 0.137 0.126 0.116 0.107 0.099 0.092 0.085 0.078 0.073 10
11 0.195 0.178 0.162 0.148 0.135 0.123 0.112 0.103 0.094 0.086 0.079 0.072 0.066 0.061 0.056 11
12 0.168 0.152 0.137 0.124 0.112 0.102 0.092 0.083 0.076 0.069 0.062 0.057 0.052 0.047 0.043 12

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ACFI3310

ACFI3310
13 0.145 0.130 0.116 0.104 0.093 0.084 0.075 0.068 0.061 0.055 0.050 0.045 0.040 0.037 0.033 13
14 0.125 0.111 0.099 0.088 0.078 0.069 0.062 0.055 0.049 0.044 0.039 0.035 0.032 0.028 0.025 14
15 0.108 0.095 0.084 0.074 0.065 0.057 0.051 0.045 0.040 0.035 0.031 0.028 0.025 0.022 0.020 15
20 0.051 0.043 0.037 0.031 0.026 0.022 0.019 0.016 0.014 0.012 0.010 0.008 0.007 0.006 0.005 20
25 0.024 0.020 0.016 0.013 0.010 0.009 0.007 0.006 0.005 0.004 0.003 0.003 0.002 0.002 0.001 25

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PRESENT VALUE of a £1 annuity at i% and n periods

1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15%

1 0.990 0.980 0.971 0.962 0.952 0.943 0.935 0.926 0.917 0.909 0.901 0.893 0.885 0.877 0.870 1
2 1.970 1.942 1.913 1.886 1.859 1.833 1.808 1.783 1.759 1.736 1.713 1.690 1.668 1.647 1.626 2
3 2.941 2.884 2.829 2.775 2.723 2.673 2.624 2.577 2.531 2.487 2.444 2.402 2.361 2.322 2.283 3
4 3.902 3.808 3.717 3.630 3.546 3.465 3.387 3.312 3.240 3.170 3.102 3.037 2.974 2.914 2.855 4
5 4.853 4.713 4.580 4.452 4.329 4.212 4.100 3.993 3.890 3.791 3.696 3.605 3.517 3.433 3.352 5
6 5.795 5.601 5.417 5.242 5.076 4.917 4.767 4.623 4.486 4.355 4.231 4.111 3.998 3.889 3.784 6
7 6.728 6.472 6.230 6.002 5.786 5.582 5.389 5.206 5.033 4.868 4.712 4.564 4.423 4.288 4.160 7
8 7.652 7.325 7.020 6.733 6.463 6.210 5.971 5.747 5.535 5.335 5.146 4.968 4.799 4.639 4.487 8
9 8.566 8.162 7.786 7.435 7.108 6.802 6.515 6.247 5.995 5.759 5.537 5.328 5.132 4.946 4.772 9
10 9.471 8.983 8.530 8.111 7.722 7.360 7.024 6.710 6.418 6.145 5.889 5.650 5.426 5.216 5.019 10
11 10.368 9.787 9.253 8.760 8.306 7.887 7.499 7.139 6.805 6.495 6.207 5.938 5.687 5.453 5.234 11
12 11.255 10.575 9.954 9.385 8.863 8.384 7.943 7.536 7.161 6.814 6.492 6.194 5.918 5.660 5.421 12
13 12.134 11.348 10.635 9.986 9.394 8.853 8.358 7.904 7.487 7.103 6.750 6.424 6.122 5.842 5.583 13
14 13.004 12.106 11.296 10.563 9.899 9.295 8.745 8.244 7.786 7.367 6.982 6.628 6.302 6.002 5.724 14
15 13.865 12.849 11.938 11.118 10.380 9.712 9.108 8.559 8.061 7.606 7.191 6.811 6.462 6.142 5.847 15
20 18.046 16.351 14.877 13.590 12.462 11.470 10.594 9.818 9.129 8.514 7.963 7.469 7.025 6.623 6.259 20
25 22.023 19.523 17.413 15.622 14.094 12.783 11.654 10.675 9.823 9.077 8.422 7.843 7.330 6.873 6.464 25

0.160 0.170 0.180 0.190 0.200 0.210 0.220 0.230 0.240 0.250 0.260 0.270 0.280 0.290 0.300
1 0.862 0.855 0.847 0.840 0.833 0.826 0.820 0.813 0.806 0.800 0.794 0.787 0.781 0.775 0.769 1
2 1.605 1.585 1.566 1.547 1.528 1.509 1.492 1.474 1.457 1.440 1.424 1.407 1.392 1.376 1.361 2
3 2.246 2.210 2.174 2.140 2.106 2.074 2.042 2.011 1.981 1.952 1.923 1.896 1.868 1.842 1.816 3
4 2.798 2.743 2.690 2.639 2.589 2.540 2.494 2.448 2.404 2.362 2.320 2.280 2.241 2.203 2.166 4
5 3.274 3.199 3.127 3.058 2.991 2.926 2.864 2.803 2.745 2.689 2.635 2.583 2.532 2.483 2.436 5
6 3.685 3.589 3.498 3.410 3.326 3.245 3.167 3.092 3.020 2.951 2.885 2.821 2.759 2.700 2.643 6
7 4.039 3.922 3.812 3.706 3.605 3.508 3.416 3.327 3.242 3.161 3.083 3.009 2.937 2.868 2.802 7
8 4.344 4.207 4.078 3.954 3.837 3.726 3.619 3.518 3.421 3.329 3.241 3.156 3.076 2.999 2.925 8
9 4.607 4.451 4.303 4.163 4.031 3.905 3.786 3.673 3.566 3.463 3.366 3.273 3.184 3.100 3.019 9
10 4.833 4.659 4.494 4.339 4.192 4.054 3.923 3.799 3.682 3.571 3.465 3.364 3.269 3.178 3.092 10
11 5.029 4.836 4.656 4.486 4.327 4.177 4.035 3.902 3.776 3.656 3.543 3.437 3.335 3.239 3.147 11
12 5.197 4.988 4.793 4.611 4.439 4.278 4.127 3.985 3.851 3.725 3.606 3.493 3.387 3.286 3.190 12

ACFI3310
17
13 5.342 5.118 4.910 4.715 4.533 4.362 4.203 4.053 3.912 3.780 3.656 3.538 3.427 3.322 3.223 13
14 5.468 5.229 5.008 4.802 4.611 4.432 4.265 4.108 3.962 3.824 3.695 3.573 3.459 3.351 3.249 14
15 5.575 5.324 5.092 4.876 4.675 4.489 4.315 4.153 4.001 3.859 3.726 3.601 3.483 3.373 3.268 15
20 5.929 5.628 5.353 5.101 4.870 4.657 4.460 4.279 4.110 3.954 3.808 3.673 3.546 3.427 3.316 20

21
25 6.097 5.766 5.467 5.195 4.948 4.721 4.514 4.323 4.147 3.985 3.834 3.694 3.564 3.442 3.329 25
FUTURE VALUE of £1 at i% and n periods

1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15%

1 1.010 1.020 1.030 1.040 1.050 1.060 1.070 1.080 1.090 1.100 1.110 1.120 1.130 1.140 1.150 1
2 1.020 1.040 1.061 1.082 1.103 1.124 1.145 1.166 1.188 1.210 1.232 1.254 1.277 1.300 1.323 2
3 1.030 1.061 1.093 1.125 1.158 1.191 1.225 1.260 1.295 1.331 1.368 1.405 1.443 1.482 1.521 3
4 1.041 1.082 1.126 1.170 1.216 1.262 1.311 1.360 1.412 1.464 1.518 1.574 1.630 1.689 1.749 4
5 1.051 1.104 1.159 1.217 1.276 1.338 1.403 1.469 1.539 1.611 1.685 1.762 1.842 1.925 2.011 5
6 1.062 1.126 1.194 1.265 1.340 1.419 1.501 1.587 1.677 1.772 1.870 1.974 2.082 2.195 2.313 6
7 1.072 1.149 1.230 1.316 1.407 1.504 1.606 1.714 1.828 1.949 2.076 2.211 2.353 2.502 2.660 7
8 1.083 1.172 1.267 1.369 1.477 1.594 1.718 1.851 1.993 2.144 2.305 2.476 2.658 2.853 3.059 8
9 1.094 1.195 1.305 1.423 1.551 1.689 1.838 1.999 2.172 2.358 2.558 2.773 3.004 3.252 3.518 9
10 1.105 1.219 1.344 1.480 1.629 1.791 1.967 2.159 2.367 2.594 2.839 3.106 3.395 3.707 4.046 10
11 1.116 1.243 1.384 1.539 1.710 1.898 2.105 2.332 2.580 2.853 3.152 3.479 3.836 4.226 4.652 11
12 1.127 1.268 1.426 1.601 1.796 2.012 2.252 2.518 2.813 3.138 3.498 3.896 4.335 4.818 5.350 12
13 1.138 1.294 1.469 1.665 1.886 2.133 2.410 2.720 3.066 3.452 3.883 4.363 4.898 5.492 6.153 13
14 1.149 1.319 1.513 1.732 1.980 2.261 2.579 2.937 3.342 3.797 4.310 4.887 5.535 6.261 7.076 14
15 1.161 1.346 1.558 1.801 2.079 2.397 2.759 3.172 3.642 4.177 4.785 5.474 6.254 7.138 8.137 15
20 1.220 1.486 1.806 2.191 2.653 3.207 3.870 4.661 5.604 6.727 8.062 9.646 11.523 13.743 16.367 20
25 1.282 1.641 2.094 2.666 3.386 4.292 5.427 6.848 8.623 10.835 13.585 17.000 21.231 26.462 32.919 25

0.160 0.170 0.180 0.190 0.200 0.210 0.220 0.230 0.240 0.250 0.260 0.270 0.280 0.290 0.300
1 1.160 1.170 1.180 1.190 1.200 1.210 1.220 1.230 1.240 1.250 1.260 1.270 1.280 1.290 1.300 1
2 1.346 1.369 1.392 1.416 1.440 1.464 1.488 1.513 1.538 1.563 1.588 1.613 1.638 1.664 1.690 2
3 1.561 1.602 1.643 1.685 1.728 1.772 1.816 1.861 1.907 1.953 2.000 2.048 2.097 2.147 2.197 3
4 1.811 1.874 1.939 2.005 2.074 2.144 2.215 2.289 2.364 2.441 2.520 2.601 2.684 2.769 2.856 4
5 2.100 2.192 2.288 2.386 2.488 2.594 2.703 2.815 2.932 3.052 3.176 3.304 3.436 3.572 3.713 5
6 2.436 2.565 2.700 2.840 2.986 3.138 3.297 3.463 3.635 3.815 4.002 4.196 4.398 4.608 4.827 6
7 2.826 3.001 3.185 3.379 3.583 3.797 4.023 4.259 4.508 4.768 5.042 5.329 5.629 5.945 6.275 7
8 3.278 3.511 3.759 4.021 4.300 4.595 4.908 5.239 5.590 5.960 6.353 6.768 7.206 7.669 8.157 8
9 3.803 4.108 4.435 4.785 5.160 5.560 5.987 6.444 6.931 7.451 8.005 8.595 9.223 9.893 10.604 9
10 4.411 4.807 5.234 5.695 6.192 6.727 7.305 7.926 8.594 9.313 10.086 10.915 11.806 12.761 13.786 10
11 5.117 5.624 6.176 6.777 7.430 8.140 8.912 9.749 10.657 11.642 12.708 13.862 15.112 16.462 17.922 11
12 5.936 6.580 7.288 8.064 8.916 9.850 10.872 11.991 13.215 14.552 16.012 17.605 19.343 21.236 23.298 12

18
ACFI3310
13 6.886 7.699 8.599 9.596 10.699 11.918 13.264 14.749 16.386 18.190 20.175 22.359 24.759 27.395 30.288 13

ACFI3310
14 7.988 9.007 10.147 11.420 12.839 14.421 16.182 18.141 20.319 22.737 25.421 28.396 31.691 35.339 39.374 14
15 9.266 10.539 11.974 13.590 15.407 17.449 19.742 22.314 25.196 28.422 32.030 36.062 40.565 45.587 51.186 15
20 19.461 23.106 27.393 32.429 38.338 45.259 53.358 62.821 73.864 86.736 101.721 119.145 139.380 162.852 190.050 20
25 40.874 50.658 62.669 77.388 95.396 117.391 144.210 176.859 216.542 264.698 323.045 393.634 478.905 581.759 705.641 25

21
FUTURE VALUE of a £1 annuity at i% and n periods

1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15%

1 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1
2 2.010 2.020 2.030 2.040 2.050 2.060 2.070 2.080 2.090 2.100 2.110 2.120 2.130 2.140 2.150 2
3 3.030 3.060 3.091 3.122 3.153 3.184 3.215 3.246 3.278 3.310 3.342 3.374 3.407 3.440 3.473 3
4 4.060 4.122 4.184 4.246 4.310 4.375 4.440 4.506 4.573 4.641 4.710 4.779 4.850 4.921 4.993 4
5 5.101 5.204 5.309 5.416 5.526 5.637 5.751 5.867 5.985 6.105 6.228 6.353 6.480 6.610 6.742 5
6 6.152 6.308 6.468 6.633 6.802 6.975 7.153 7.336 7.523 7.716 7.913 8.115 8.323 8.536 8.754 6
7 7.214 7.434 7.662 7.898 8.142 8.394 8.654 8.923 9.200 9.487 9.783 10.089 10.405 10.730 11.067 7
8 8.286 8.583 8.892 9.214 9.549 9.897 10.260 10.637 11.028 11.436 11.859 12.300 12.757 13.233 13.727 8
9 9.369 9.755 10.159 10.583 11.027 11.491 11.978 12.488 13.021 13.579 14.164 14.776 15.416 16.085 16.786 9
10 10.462 10.950 11.464 12.006 12.578 13.181 13.816 14.487 15.193 15.937 16.722 17.549 18.420 19.337 20.304 10
11 11.567 12.169 12.808 13.486 14.207 14.972 15.784 16.645 17.560 18.531 19.561 20.655 21.814 23.045 24.349 11
12 12.683 13.412 14.192 15.026 15.917 16.870 17.888 18.977 20.141 21.384 22.713 24.133 25.650 27.271 29.002 12
13 13.809 14.680 15.618 16.627 17.713 18.882 20.141 21.495 22.953 24.523 26.212 28.029 29.985 32.089 34.352 13
14 14.947 15.974 17.086 18.292 19.599 21.015 22.550 24.215 26.019 27.975 30.095 32.393 34.883 37.581 40.505 14
15 16.097 17.293 18.599 20.024 21.579 23.276 25.129 27.152 29.361 31.772 34.405 37.280 40.417 43.842 47.580 15
20 22.019 24.297 26.870 29.778 33.066 36.786 40.995 45.762 51.160 57.275 64.203 72.052 80.947 91.025 102.444 20
25 28.243 32.030 36.459 41.646 47.727 54.865 63.249 73.106 84.701 98.347 114.413 133.334 155.620 181.871 212.793 25

0.160 0.170 0.180 0.190 0.200 0.210 0.220 0.230 0.240 0.250 0.260 0.270 0.280 0.290 0.300
1 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1
2 2.160 2.170 2.180 2.190 2.200 2.210 2.220 2.230 2.240 2.250 2.260 2.270 2.280 2.290 2.300 2
3 3.506 3.539 3.572 3.606 3.640 3.674 3.708 3.743 3.778 3.813 3.848 3.883 3.918 3.954 3.990 3
4 5.066 5.141 5.215 5.291 5.368 5.446 5.524 5.604 5.684 5.766 5.848 5.931 6.016 6.101 6.187 4
5 6.877 7.014 7.154 7.297 7.442 7.589 7.740 7.893 8.048 8.207 8.368 8.533 8.700 8.870 9.043 5
6 8.977 9.207 9.442 9.683 9.930 10.183 10.442 10.708 10.980 11.259 11.544 11.837 12.136 12.442 12.756 6
7 11.414 11.772 12.142 12.523 12.916 13.321 13.740 14.171 14.615 15.073 15.546 16.032 16.534 17.051 17.583 7
8 14.240 14.773 15.327 15.902 16.499 17.119 17.762 18.430 19.123 19.842 20.588 21.361 22.163 22.995 23.858 8
9 17.519 18.285 19.086 19.923 20.799 21.714 22.670 23.669 24.712 25.802 26.940 28.129 29.369 30.664 32.015 9
10 21.321 22.393 23.521 24.709 25.959 27.274 28.657 30.113 31.643 33.253 34.945 36.723 38.593 40.556 42.619 10
11 25.733 27.200 28.755 30.404 32.150 34.001 35.962 38.039 40.238 42.566 45.031 47.639 50.398 53.318 56.405 11
12 30.850 32.824 34.931 37.180 39.581 42.142 44.874 47.788 50.895 54.208 57.739 61.501 65.510 69.780 74.327 12

19
13 36.786 39.404 42.219 45.244 48.497 51.991 55.746 59.779 64.110 68.760 73.751 79.107 84.853 91.016 97.625 13

ACFI3310
ACFI3310
14 43.672 47.103 50.818 54.841 59.196 63.909 69.010 74.528 80.496 86.949 93.926 101.465 109.612 118.411 127.913 14
15 51.660 56.110 60.965 66.261 72.035 78.330 85.192 92.669 100.815 109.687 119.347 129.861 141.303 153.750 167.286 15
20 115.380 130.033 146.628 165.418 186.688 210.758 237.989 268.785 303.601 342.945 387.389 437.573 494.213 558.112 630.165 20
25 249.214 292.105 342.603 402.042 471.981 554.242 650.955 764.605 898.092 1054.791 1238.636 1454.201 1706.803 2002.616 2348.803 25

21
 20
16 21
23
Cumulative normal probability tables (Z-Values)
ACFI3310
ACFI3310
 17 23
21 21
ACFI3310
ACFI3310
Cumulative normal probability tables (Z-Values)