please help with these questions
QUESTION #4 der the same data as in question 3 and now assume that the required annual yield-to-maturity of the bond, denoted by k, will change with X as follows: k=X+ 4% Recalculate the current price of the bond. QUESTION #5 The current dividende merch current dividends per share per quarter of a common stock are $0.6 and dividends are expected to be paid quarterly and into indefinite future. The quarterly growth rate of the dividends stream is 1.0% and it is expected to stay the same into indefinite future. The required expected rate of return on the common stock is 14% per annum. Find: (i) The current price per share of the stock. (ii) The expected price per share at the end of the 4 quarter. QUESTION #6 A European put option on the common stock of XYZ Lid. is currently selling for a price of $3 per share. The expiration date of the put is 6 months from now. The relevant interest rate is 2% per annum. The exercise price of the put is $30 per share and the size of one put is 100 shares. Suppose Mr. Miller sells 10 of these puts now, find his profitcloss), assuming the spot price of the stock on the expiration date to be equal to either () $20 or (ii) $40. Secondly, find the break-even level of the spot price of the stock on the expiration date. QUESTION #7 McCain Food Ltd. expects to receive 1.0 billion on December 20, 2019, from a Japanese importer of its products. Today is September 20, 2019 and the spot price between CS and is C$0.01192 -*1.0. The 3- month futures exchange rate is C$0.012 per one yen. One futures contract is of the size of 12.5 million. Show how McCain foods can hedge the receipt of the # 1.0 billion by using the futures market. Secondly, show McCain Foods profit(loss) from hedging its position fully, assuming that the exchange rate on December 20, 2019 is expected to be $0.02 per. QUESTION #8 Ms. Bodkin bought 500 shares of common stock of ABC Ltd. at $60 a share a few years ago. Currently, price per share of ABC's stock is $100. Suppose she takes a short position of 400 shares at the current price of $100. For the following possible spot price on the settlement date, denoted by S, calculate capital gain(loss) from her total position in ABC's stock: (1) S - $120 (ii) S - $40 Does her short position of 400 shares provide a perfect or partial hedge? Explain. L was J.00 UMI. Find the balance sheet of the bank as of August 31, 2019. QUESTION #3 Currently, a bond has the face value of $1,000, the remaining term of 2 years the coupon interest to be paid every six months and its coupon rate is set as follows: The coupon rate = the annual yield on 10-year GOC bond, prevailing at the time of payment (call it X) + 3.5% Suppose the required yield-to-maturity of the bond is 7% per annum and it is expected to stay the same X is expected to be 3%, 4%, and 4.5% and 5% at the end of the 1"6-month period, 2nd 6-month period, 3rd 6-month period and 4th 6-month period respectively. Find the current price of the bond. QUESTION #4 der the same data as in question 3 and now assume that the required annual yield-to-maturity of the bond, denoted by k, will change with X as follows: k=X+ 4% Recalculate the current price of the bond. QUESTION #5 The current dividende merch current dividends per share per quarter of a common stock are $0.6 and dividends are expected to be paid quarterly and into indefinite future. The quarterly growth rate of the dividends stream is 1.0% and it is expected to stay the same into indefinite future. The required expected rate of return on the common stock is 14% per annum. Find: (i) The current price per share of the stock. (ii) The expected price per share at the end of the 4 quarter. QUESTION #6 A European put option on the common stock of XYZ Lid. is currently selling for a price of $3 per share. The expiration date of the put is 6 months from now. The relevant interest rate is 2% per annum. The exercise price of the put is $30 per share and the size of one put is 100 shares. Suppose Mr. Miller sells 10 of these puts now, find his profitcloss), assuming the spot price of the stock on the expiration date to be equal to either () $20 or (ii) $40. Secondly, find the break-even level of the spot price of the stock on the expiration date. QUESTION #7 McCain Food Ltd. expects to receive 1.0 billion on December 20, 2019, from a Japanese importer of its products. Today is September 20, 2019 and the spot price between CS and is C$0.01192 -*1.0. The 3- month futures exchange rate is C$0.012 per one yen. One futures contract is of the size of 12.5 million. Show how McCain foods can hedge the receipt of the # 1.0 billion by using the futures market. Secondly, show McCain Foods profit(loss) from hedging its position fully, assuming that the exchange rate on December 20, 2019 is expected to be $0.02 per. QUESTION #8 Ms. Bodkin bought 500 shares of common stock of ABC Ltd. at $60 a share a few years ago. Currently, price per share of ABC's stock is $100. Suppose she takes a short position of 400 shares at the current price of $100. For the following possible spot price on the settlement date, denoted by S, calculate capital gain(loss) from her total position in ABC's stock: (1) S - $120 (ii) S - $40 Does her short position of 400 shares provide a perfect or partial hedge? Explain. L was J.00 UMI. Find the balance sheet of the bank as of August 31, 2019. QUESTION #3 Currently, a bond has the face value of $1,000, the remaining term of 2 years the coupon interest to be paid every six months and its coupon rate is set as follows: The coupon rate = the annual yield on 10-year GOC bond, prevailing at the time of payment (call it X) + 3.5% Suppose the required yield-to-maturity of the bond is 7% per annum and it is expected to stay the same X is expected to be 3%, 4%, and 4.5% and 5% at the end of the 1"6-month period, 2nd 6-month period, 3rd 6-month period and 4th 6-month period respectively. Find the current price of the bond
