MICRO-CASES-SG862.48M12

Requirement-A. The par value of 16-year 11.1% bond of SRT Ltd is $1,000. The bond was issued 6 years ago. Coupons are paid quarterly. The current market price of the bond is $862.48. Calculate the current yield to maturity for this bond. <1 mark>

Requirement-B. GRT Ltd issued a corporate bond with a maturity of 25-year. The par value of this 12% bond is $5,000. The current market yield for a similar risky bond is 15.30%. The bond has a remaining life of 10 years and the coupon is paid semi-annually. What would be the expected market price for this bond? <1 mark>

Requirement-C. MRT Ltd has just declared a dividend of $4.35 per share. It is estimated by the analysts that the returns from this ordinary share of MRT Ltd would be 11.6 percent. The earnings and dividends of MRT Ltd share are anticipated to grow at 21 percent for the next 3 years before settling down to a constant 4.3% growth rate. What price is expected for MRT share by the investors? <1 mark>