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a . Nur Syurga has a saving of RM 1 0 , 0 0 0 and is planning to make her first investment. Kim Loong
a Nur Syurga has a saving of RM and is planning to make her first investment. Kim Loong her financial consultant offers her three investment options as below:
Option A: Samsung Bond with par value of RM pays coupon payment semiannually, matures in years. The bond is selling at RM
Option B: Air Asia preferred stock paying a dividend of RM and selling for RM
Option C: UNITAR Capital dividend, with rate grow at this year, on the second year, on the third year and thereafter. The current dividend Do is RM and the stock is selling at RM
The required rate of return for the above investments is as follows:
required rate of return
Bond
Preferred stock
Common Stock
i Calculate the value of each investment option.
ii Which investment should Nur Syurga choose. Explain your answer.
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