A 20-year bond is issued today with a face value of $1,000. The bond pays semi-annual coupon at 5% p.a. (nominal). The issue price gives potential investor a yield to maturity of 6% p.a. (nominal). Without calculation, you can tell the bond must be a bond. (1 mark) You have this conclusion because _(Selecto ing reasons) (1 mark) the face value must be lower than the price of the par Othe coupon rate is smaller than the yield to maturit premium the bond pays coupon every half year Othis is a coupon bond discount Calculate the issue price of the bond. (Round your answer to 2 decimal places. Do not include the 5 symbol. Do not use comma separators. Eg. 1234.56) 2 marks) A 20-year bond is issued today with a face value of $1,000. The bond pays semi-annual coupon at 5% p.a. (nominal). The issue price gives potential investor a yield to maturity of 6% p.a. (nominal). Without calculation, you can tell the bond must be a bond. (1 mark) You have this conclusion because (Select one of the following reasons) (1 mark) Othe face value must be lower than the price of the bond Othe coupon rate is smaller than the yield to maturity Othe bond pays coupon every half year Cthis is a coupon bond Calculate the issue price of the bond. (Round your answer to 2 decimal places. Do not include the $ symbol. Do not use comma separators. E.g. 1234.56) (2 marks) A 10-year bond was issued at par on 1 July 2017. The bond has a face value of $1,000 and pays annual coupons at 4% p.a. Jenny purchased the bond on its issue date and sold it to Emma on 1 July 2019 immediately after the coupon payment. Emma paid a price that gave her a yield of maturity of 3% p.. Which of the following can be used to find the price Emma paid for this bond (only one correct answer)? Select one: O a. None of the options give the price Emma paid. 40 O b. 1000 * (1 - 1.03-10) + 0.03 1.0310 1000 1000 . *(1 - 1.03-10) + 0.03 1.0310 40 1000 O d. * (1 - 1.03-2) + 0.03 1.032 40 1000 (1 - 1.04-8) + 0.04 1.048 40 1000 O f. (1 - 1.03-8) + 0.03 1.038 e A company wants to raise $600,000 by issuing zero coupon bonds. The bonds have a face value of $1,000 and will mature in 8 years. The issue price gives potential investors a yield to maturity of 3% p.a. (nominal). Assume comparable-risk coupon bonds normally pay semi-annual coupons Calculate the issue price per bond. (Round your answer to 2 decimal places. Do not include the $ symbol. Do not use comma separators. E.g. 1234,56) (2 marks) How many bonds should the company issue to raise enough money? (Do not include unit. Do not use comma separators.) (1 mark) A preference share is going to pay a dividend of $2 in one year. Use the dividend discount model (DDM), calculate the expected share price in three years if the rate of return is 7% p.a. (Round your answer to 2 decimal places. Do not include the $ symbol. Do not use comma separators. E.g. 1234.56) Answer: An ordinary share just paid a dividend of $1.20. The share is expected to pay annual dividends growing at 3% p.a. forever. Use the dividend discount model (DDM). If the rate of return is 11% p.a., which of the following can be used to find the share price in three years (only one correct answer? (2 marks) ONone of the options give the correct answer 01.2*(1.03)^3/(0.11-0.03) 01.2/(0.11-0.03) 01.2"(1.03) 4/(0.11-0.03) 01.2"(1.11)^3/(0.11-0.03) 01.2"(1.11)4/(0.11-0.03) The share price in three years should be (Round your answer to 2 decimal places. Do not include the symbol. Do not use comma separators. E.g. 1234,56) (1 mark) An ordinary share pays dividend every year at a constant growth rate of g p.a. forever. The share has just paid a dividend of $3. Jacky buys the share today for $40 at a rate of return of 12% p.a. for the next 12 months. Which of the following can be used to calculate the return on income for Jacky if he plans to sell the share in 12 months immediately after he receives the dividend (only one correct answer)? (2 marks) ONone of the options give the correct answer. 03'1.12/40 03"(1+g)/40 03*(1+9)/40+0.12 03"(1+9)/40+9 03/40 Calculate the annual growth rate g for this share. (Round your answer to a percentage of 2 decimals without the symbol. Eg. if you answer is 0.12345, you should input "12.35") (2 marks)