Everest Company Of Investment Was Established In 2015 And It Has The Different Arena Of Investment Portfolio. Manufacturing Is One Of The Successful Sector And Currently It Has Also Manufacturing The Herbal And Supplying In The Major Cities In The Nepal. Government Of Nepal Is Taking The Export Promotion And Import Substitution Policy In The Fiscal Policy
Everest Company of investment was established in 2015 and it has the different arena of
investment portfolio. Manufacturing is one of the successful sector and currently it has also
manufacturing the herbal and supplying in the major cities in the Nepal. Government of
Nepal is taking the export promotion and import substitution policy in the fiscal policy 2021.
Local and central government has given the subsidies for the manufacturing firms and there
is the tax rebate to the manufacturing in the specific economic zone. The Research and
development department of the projected the income report as follows.
Prob. 0.1 0.2 0.3 0.25 0.15
Earning 10% 15% 20% 12% 18%
FINC 5101/FEB 2022Page 4 of 4
a. What is the expected risk and return of the project. (5 Marks)
b. What is coefficient of variation and why it is important ? Calculate the value of
coefficient of variation . (5 Marks)
c. Suppose the firm has Rs. 100 millions net profit in last year. The BOD is planning to
invest this profit after paying 10% dividend to its stockholders and there are the different
investment opportunities in the market. Suppose you are the financial officer of Everest
Company, do you invest the entire retain earning amount in a single investment sector. If
yes, explain your justification, if no, interpret in line with Markowitz model.
