Gulrukh Holdings Berhad is a property developer company in Malaysia, due to high demand of property, the company has decided to build up a new township which located at Bangi. The projects estimated cost is RM750 million and they were planning to finance using debt which by issuing bond. The bond has a par value RM1,000 with 8 percent coupon rate and will mature in 10 years. Dr. Carson is a retail investor and he has decided to buy the bond.

a) Calculate the value of bond (Vb) if the required rate of return is 7 percent.

(4 marks)

b) Determine the new value of bond (Vb) if the market rate has increased to 10 percent.

(4 marks)

c) Find the Yield to Maturity (YTM). Use the answer in (ii) as your Present Value.

(4 marks)

d) Calculate the Yield to Put (YTP) with the discount rate 6 percent after 3 years.

(4 marks)

e) Calculate the Yield to Call (YTC) with the premium rate 5 percent after 8 years.

(4 marks)