PLEASE HELP ME ...................... EMERGENCY .................

(b) Acme Glove Berhad has two bond issues outstanding, and both sell for RM750. The first issue has a coupon rate of 7% and 15 years to maturity. The second issue has an identical yield to maturity as the first bond, but with only 5 years to maturity. Both issues pay interest annually. (i) What is the coupon rate of the second issue? (8 marks) (ii) A plot of the relationship between bond yields and maturity is known as the yield-curve. How do you interpret an upward-sloping yield curve? (2 marks) (iii) Explain TWO (2) reasons why investors may still rationally avoid long- term bonds despite the upward-sloping yield curve. (4 marks) [Total: 30 marks)