QUESTION 1 a. Excel Courier (Gh.) Ltd. has an 8% bond making semi-annual payments. The bond has a face value of GH1,000 and has 13 years to maturity. Aseda Co. Ltd. has just issued a 10-year 10% coupon bond making annual payments. The bond has a face value of GH1,000. What is the value of the two bonds to an investor whose required rate of return is 9%? (2 marks) b. Ghana Cocoa Limited has a 6 percent coupon bond outstanding. Ghana Bauxite Ltd has a 14 percent bond outstanding. Both bonds have 8 years maturity and make semi-annual payments. i. How much should an investor who has a required rate of return of 10% pay for GH10,000 worth of each bond? (2 marks) ii. If the interest rates suddenly rise by 2 percent, what is the percentage change in the price of these bonds? (2 marks) c. Lobers, Inc., has two investment proposals, which have the following characteristics: Period Project A Project B 0 -9000 -12000 1 5000 5000 2 4000 5000 3 3000 8000 For each project, compute its payback period, its net present value, and its profitability index using a discount rate of 15 percent. (9 marks) d. Assume that the cash flows of a project are given as follows: Year Cash Flow 0 -800 1 500 2 700 3 -650 4 800 5 900 The reinvestment rate is given as 20%, whilst the financing rate has been specified as 15%. Find the MIRR of the project.