MAC2602 ASSIGNMENT 02
SEMESTER 02 2025
WRIITREN BY EXPERT ACADEMY
WHATSAPP 0645167275
ALL QUESTIONS ARE COVRED WITH
CALCULATIONS
, Question 01
1.1. (c)
1.2. (d)
1.3. (b)
1.4. (b)
Question 02
2A
1. Geopolitical Challenges: MTN's decision to dispose of its investment in Guinea
highlights the effect of geopolitical instability on its international operations. MTN
must consider the impact of these risks on its other foreign investments and strategic
direction.
2. Shrinking Household Disposable Income: In South Africa, lower disposable income
has led to a rise in bad debts. This affects MTN's revenue collection and profitability,
indicating a need for more focused credit management and revised pricing strategies
to maintain customer payments.
3. Bad Debt Impact: MTN’s increasing bad debt issue suggests it may need to revise its
credit policies, focusing on more stringent payment terms and collection strategies to
mitigate financial losses.
4. Subscriber Base Growth: MTN is experiencing slow subscriber base growth,
indicating that competition in the South African market is affecting customer
acquisition and retention. This requires MTN to innovate and differentiate its services
to attract and retain customers.
5. Capital Expenditure Cuts: The planned reduction in capital expenditure by R4.1
billion signals that MTN is tightening its budgets, possibly delaying network
expansions and upgrades. This decision could impact long-term growth and
competitiveness.
6. Interest Rate Changes: The difference between MTN’s loan interest rates (10% and
11%) and market rates (12%) could affect its financing strategy. MTN must assess
how future interest rate fluctuations could impact its cost of capital and financial
planning.
7. Taxation Impact: With a taxation rate of 27%, MTN needs to optimize its tax
planning strategies to manage costs effectively. The impact of tax on its profit
SEMESTER 02 2025
WRIITREN BY EXPERT ACADEMY
WHATSAPP 0645167275
ALL QUESTIONS ARE COVRED WITH
CALCULATIONS
, Question 01
1.1. (c)
1.2. (d)
1.3. (b)
1.4. (b)
Question 02
2A
1. Geopolitical Challenges: MTN's decision to dispose of its investment in Guinea
highlights the effect of geopolitical instability on its international operations. MTN
must consider the impact of these risks on its other foreign investments and strategic
direction.
2. Shrinking Household Disposable Income: In South Africa, lower disposable income
has led to a rise in bad debts. This affects MTN's revenue collection and profitability,
indicating a need for more focused credit management and revised pricing strategies
to maintain customer payments.
3. Bad Debt Impact: MTN’s increasing bad debt issue suggests it may need to revise its
credit policies, focusing on more stringent payment terms and collection strategies to
mitigate financial losses.
4. Subscriber Base Growth: MTN is experiencing slow subscriber base growth,
indicating that competition in the South African market is affecting customer
acquisition and retention. This requires MTN to innovate and differentiate its services
to attract and retain customers.
5. Capital Expenditure Cuts: The planned reduction in capital expenditure by R4.1
billion signals that MTN is tightening its budgets, possibly delaying network
expansions and upgrades. This decision could impact long-term growth and
competitiveness.
6. Interest Rate Changes: The difference between MTN’s loan interest rates (10% and
11%) and market rates (12%) could affect its financing strategy. MTN must assess
how future interest rate fluctuations could impact its cost of capital and financial
planning.
7. Taxation Impact: With a taxation rate of 27%, MTN needs to optimize its tax
planning strategies to manage costs effectively. The impact of tax on its profit