A client is interested in two investments an offshore bond and shares in a local company. The client$$s opportunity cost is $12\%[$this means that the client can make $12\%$ on other investments$].$ Assume the EURO: Rand exchange rate is EUR $1$:R$15$ throughout the period of the bond. The dividend for the share is the expected dividend at the end of year one $($D$1)$ and not the current dividend $($D$0).$ Conditions BZA Bond XTY Ltd $$ Shares Total nominal value EUR $8500000$ Total market value of shares $(100000$ shares x R$1000$ price per share$)$ R$100000000$ Market value of the bond R$100000000$ Coupon $($fixed$)7\%$ Interest payments Interest is paid out on the bond each year Dividends per share per annum $(100000$ shares$)($D$1)$ R$100$ Expected dividend growth rate $5\%$ Issue date$/$Purchase date $1$ January $20201$ January $2020$ Maturity date $1$ January $202519$ You are required to use the investment information provided You are required to use the investment information provided aboveabove to answer the following to answer the following questions:questions: $($a$)$ Determine if the present $($a$)$ Determine if the present value of each investment$$s future cash flows is greater than or value of each investment$$s future cash flows is greater than or smaller than its current market value.smaller than its current market value. $(10$ marks$)(10$ marks$)($b$)$ Calculate the return $($or yield to maturity$)$ for each investment. $($b$)$ Calculate the return $($or yield to maturity$)$ for each investment. $(10$ marks$)(10$ marks$)($c$)$ Comment on whether each option $($the bond and the shares$)$ is a good investment in view $($c$)$ Comment on whether each option $($the bond and the shares$)$ is a good investment in view of your answer to $($a$)$ and $($b$)$ above.of your answer to $($a$)$ and $($b$)$ above. $(5$ marks$)(5$ marks