An investor is considering purchasing 10,000 nominal of a 10-year bond paying a coupon of 3% at the end of each year, and offering a redemption payment of 105% of the nominal value of the bond at the end of the term. Before making the investment, the investor has asked you to calculate the net annual yield expected to be earned on the bond, assuming it is held to redemption. a) i) Explain briefly why the net yield figure may be useful to the investor; ii) Outline the limitations of using the net yield figure in this way. [6 marks] b) i) State the additional pieces of information you would require in order to be able to calculate the net yield for the investor; ii) For each piece of missing information stated in part i), explain why it is required; ii) For each piece of missing information stated in part i), explain what would happen to the net yield calculated if the value of the missing assumption were to increase. (12 marks] c) State four potential implications to the investor of selling the investment before the end of the 10-year term. [4 marks] [Total: 22 marks]