(a)

Kak Lina's husband had recently passed away and in order to earn an income Kak Lina wants to borrow RM1,000 from Pak Karim to start a "goreng pisang" business. Pak Karim has set a condition that requires Kak Lina to pay him RM200 every week for the next 5 weeks.

Explain why the above transaction is not allowed in Islam.

(10 marks)

(b)

Pretty Sweet (PS) stock dividends has grown at 10 percent per year for the past 10 years and is expected to maintain its future dividends at that rate. Investors believe that a year from now the company will pay a dividend of RM3 per share.

If the market's required return on PS stock is 12 percent, what is the value of the share today and how much will be its share price a year from today after the stockholders have received their dividend?

(5 marks)

(c)

ABC bond has an 8% coupon rate with interest paid semi-annually, a maturity value of $1,000, and will mature in 5 years.

If the market yield is 6%, what is the value of ABC bond today?

(5 marks)

(d)

Public listed companies are required by law to hold an Annual General Meeting (AGM) once a year.

List TWO (2) items that are to be voted in the AGM and THREE (3) items that are to be voted in the Extra Ordinary General Meeting (EGM).

(5 marks)