Question 1.

Question 2.

A fixed-interest security bears interest of 10% per annum payable half-yearly in arrear. The security will be redeemed at 105% by five instalments, of equal nominal amount, on 31 July in each of theyears 2016 to 2020 inclusive. An investor, who is liable to income tax at the rate of 40%, purchased the entire security on 31 July 2006, immediately following the interest payment then due, at a priceto obtain a net yield of 9% per annum effective. Cash payable on redemption is Select one: a. 534 b. 418 c. 525 d. 435 e. 415 A fixed-interest security bears interest of 10% per annum payable half-yearly in arrear. The security will be redeemed at 105% by five instalments, of equal nominal amount, on 31 July in each of the years 2016 to 2020 inclusive. An investor, who is liable to income tax at the rate of 40%, purchased the entire security on 31 July 2006, immediately following the interest payment then due, at a priceto obtain a net yield of 9% per annum effective. The annual coupon rate per unit is Select one: a. 7.14% O b. 11.6% O c. 12.4% d. 10% O e. 9.52% A fixed-interest security bears interest of 10% per annum payable half-yearly in arrear. The security will be redeemed at 105% by five instalments, of equal nominal amount, on 31 July in each of theyears 2016 to 2020 inclusive. An investor, who is liable to income tax at the rate of 40%, purchased the entire security on 31 July 2006, immediately following the interest payment then due, at a priceto obtain a net yield of 9% per annum effective. Cash payable on redemption is Select one: a. 534 b. 418 c. 525 d. 435 e. 415 A fixed-interest security bears interest of 10% per annum payable half-yearly in arrear. The security will be redeemed at 105% by five instalments, of equal nominal amount, on 31 July in each of the years 2016 to 2020 inclusive. An investor, who is liable to income tax at the rate of 40%, purchased the entire security on 31 July 2006, immediately following the interest payment then due, at a priceto obtain a net yield of 9% per annum effective. The annual coupon rate per unit is Select one: a. 7.14% O b. 11.6% O c. 12.4% d. 10% O e. 9.52%