Question 1A (5 marks) Before the arrival of a large order, a firm has the following limit orders standing on its book: Sell Order Seller Buyer Terence Henry Shane Buy Order 15000 8000 10000 Price $100.1 $100.2 $100.3 $100.4 $100.5 $100.6 4000 6000 12000 Helen Sabrina Michael Buyer Tina submits a market order to buy 15000 units of share. With whom does she trade? What is her average trade price? How does the limit order book look like afterward? Question 1B (5 marks) Catherina makes an investment in the Australian equity market index using her own fund of $200,000 and a margin loan that provides $100,000. The following table is prepared by Catherina. If there is a 40% rise in her portfolio value, compute the net portfolio value and the loan to value (LVR) ratio for her geared portfolio. What is the rate of return of her investment with gearing? Initial Investment Borrowed Fund Portfolio Value Geared Portfolio 200,000 100,000 300,000 Ungeared Portfolio 200,000 0 200,000 Question 1C (5 marks) Great Dynaquest Ltd. has paid its annual dividend of $4 recently. The firm is expected to grow at 30% per year for the next three years due to its leading position in developing mobile application for online-shopping. After 3 years of high growth, the firm is expected to grow into the future at a constant rate of 6% per year. Estimate the share value of the firm if the market required rate of return is 16% p.a