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a. Briefly discuss the general relationship between risk and expected return from an equity and bond investor's point of view. (7 marks) b. Provide a

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a. Briefly discuss the general relationship between risk and expected return from an equity and bond investor's point of view. (7 marks) b. Provide a brief explanation of unsystematic risk and systematic risk illustrating one example for each of them. Outline under what circumstances is an investor likely to ignore unsystematic risk. (7 marks) c. The stock of TKY Plc has a beta () value estimated to be 0.10. What does this value suggest about TKY Plc's stock? (7 marks) d. The following table displays information about the shares and bonds of Aber Plc, as well as the market. The percentage figures are expressed on an annual basis. Calculate Aber Plc's weighted average cost of capital (WACC) assuming the company wants to raise finance, 40% of which will comprise debt. Show your workings and round figures to two decimal points. (8 marks) a. Briefly discuss the general relationship between risk and expected return from an equity and bond investor's point of view. (7 marks) b. Provide a brief explanation of unsystematic risk and systematic risk illustrating one example for each of them. Outline under what circumstances is an investor likely to ignore unsystematic risk. (7 marks) c. The stock of TKY Plc has a beta () value estimated to be 0.10. What does this value suggest about TKY Plc's stock? (7 marks) d. The following table displays information about the shares and bonds of Aber Plc, as well as the market. The percentage figures are expressed on an annual basis. Calculate Aber Plc's weighted average cost of capital (WACC) assuming the company wants to raise finance, 40% of which will comprise debt. Show your workings and round figures to two decimal points. (8 marks)

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