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Political Risk Component

Composent Sub-sub component Hightest Score

Govt Stability Govt Unity 4

Legislative Strangth 4

Popular Support 4

Sub-Total 12

Socioeconomic Condition Unemployment 4Consumer confdance 4

Poverty 4

Sub-total 12

nvestment Pro!le Contract Vaibility/Eproportion 4

Proft !epatriation 4

Payment delays 4

Sub-total 12

nternal Con"ict Civil "ar/Coup threat 4

#errorism/ Political Violence 4

Civil $isorder 4Sub-total 12

#$ternal Con"ict "ar 4

Cross%&order con'ict 4

(oreign Pressure 4

Sub-total 12

Corruption )

%ilitary in politics )

Religious tension )

&a' and order )

#thnic tension )(emocratic accoutibily )

)ureaucracy *uality 4

Total+ 1,,

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Score

4

4

*

11

*+,)

+

./

4

4

*

11

4

*,-

*,-11

4

4

*,-

11.0

-

-

-,-

-

--

*

0./

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Column1 Column2

The economic risk rating

Components

G$P per .ead -

!eal G$P Groth 01

2nnual 3n'ation !ate 01

&udget balance as a o5 G$P 01Current 2ccount as a o5 G$P 0-

Total+ 0,

The inancial Risk

Components

(oreign debt as a o5 G$P 01

(oreign debt service as o5 Eport o5 goods and Service 01

Current 2ccount as a o5 Eports o5 goods and services 0-

6et international Li7idity as 8onths o5 3mport cover -

Echange rate stability 01

Total+ 0,

CP#R34ustralia5 .,0

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Column*

Points

-

01

9,-

:04

6/.0

Point

9

;

0-

4

01

66

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Telstra 3in million5 7apan Telecom3in million5

Current 2ssets +

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Teleglobe 3in million5

99)

-

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Sales Growth rate 0.05

Variable cost (proportion of sales) 0.25

Annual Fixed cost 125

ost of capital 0.1512

!or"in# apital 25.00

Initial Outlay

S$ste% cost &25 S$ste% cost

onstruction ontin#e &0

'ther eelop%ent o *0

!or"in# apital 25 +'+A,

Total 520

250

-

Sales

ash anufac. osts

Fixed ost

epreciation

/rofit before tax+ax

/rofit after tax

Add epreciation

ash flow fro% operations

Sala#e-achine

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Additionalecoer$ of !

et ash flow (520)

/V

3

3

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1 2 * &

24.444444444 24.444444444 24.444444444 24.444444444

24.4 24.4 24.4 24.4

1 2 * &

24* 24 267 *0&

44 47 2 4

125 125 125 125

24.4 24.4 24.4 24.4

&5 55 45 415 17 22 24

*0 *4 &* 50

24.4 24.4 24.4 24.4

54.50 4*.00 47.62 4.77

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54.50 4*.00 47.62 4.77

20

15.&18

15.58

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Depreciation

5 4 6 7

24.444444444 24.444444444 24.444444444 24.444444 24.444444

24.4 24.4 24.4 24.4 24.4

5 4 6 7

*17 **5 *52 *47 *66

60 6& 66 72 7

125 125 125 125 125

24.4 24.4 24.4 24.4 24.4

66 100 112 125 1*7*0 *& *6 &* &

56 44 & 6* 72

24.4 24.4 24.4 24.4 24.4

6&.51 72.&0 100.0 107.&0 116.5&

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6&.51 72.&0 100.0 107.&0 116.5&

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10 11 12 1* 1& 15

24.444444 24.444444 24.444444 24.444444 24.444444 24.444444

24.4 24.4 24.4 24.4 24.4 24.4

10 11 12 1* 1& 15

&0 &26 &&7 &1 &75 520

102 10 112 116 12& 1*0

125 125 125 125 125 125

24.4 24.4 24.4 24.4 24.4 24.4

15& 147 165 202 220 2*652 5 4* 47 5 61

101 112 122 1** 1&5 15

24.4 24.4 24.4 24.4 24.4 24.4

126.1& 1*6.22 1&6.60 157.72 11.56 16*.6*

25

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25

126.1& 1*6.22 1&6.60 157.72 11.56 2**.6*

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22/39

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23/39

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24/39

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$iscount rate 1,0-

!eal =ption Upgrade o5 capacity

3nitial 3vestment -1111111

Probability

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6Ad+B 1,-;4;+091-

C A90822819.;0

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y%4 PV o5 in'o !eturn Probability Epected return

0+111111 @*4

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Varience

1,14:;+;9*4;

1,1+)+:*0;;:1,11+1;:;1+-

1,1+)10:;0-+

1,1;:9-*-))4

,.19;9;;

,.62;21;

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1;; Telstra 3in million5 7apan Telecom3in million5

Current 2ssets +

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E2! 0::9 #elstra Dapan #elecom

Proft margin 0;,*) 0,:)

#elstra Dapan #elecom #eleglobe

1

1,+

1,4

1,)

1,9Current !atio

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Teleglobe 3in million5

99)

-

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#eleglobe

%+,-*

#elstra Dapan #elecom #eleg%-,11

1,11

-,11

01,11

0-,11

+1,11

Pro!t margi

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#eleglobe

0:,0;

n

Gross margin

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lobe

n

Proft margin