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2. (a) A 5-year bond has a face value of 1000 and a coupon rate of 9%. Yield to maturity is 7% per annum.

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2. (a) A 5-year bond has a face value of 1000 and a coupon rate of 9%. Yield to maturity is 7% per annum. The coupons are paid annually. (Round to 2 decimal places) i. Calculate the price of this bond when it is issued ii. If the yield to maturity of the bond is 10% per annum, then what is the price of the bond when it is issued? (b) XYZ company has recently announced a rights issue to raise $60 million for a new project. The current price is $50 per share with 6 million shares outstanding. If the subscription price is $40 per share, Required: a) Calculate the prospective price of XYZ company after the rights issue b) Calculate the value of a right

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