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QUESTION 2 (25 MARKS) (a) A RM1,000 coupon bond mature in 10 years has a coupon rate of 8 percent. Calculate the price of this

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QUESTION 2 (25 MARKS) (a) A RM1,000 coupon bond mature in 10 years has a coupon rate of 8 percent. Calculate the price of this bond, using the following market rate of interest of: i. 6 percent. (4 marks) ii. 8 percent. (4 marks) iii. 12 percent. (4 marks) (b) Identify the types of bonds in question (a) (6 marks) (c) Explain the relationship between the bond value and its required rate of return. (7 marks) QUESTION 2 (25 MARKS) (a) A RM1,000 coupon bond mature in 10 years has a coupon rate of 8 percent. Calculate the price of this bond, using the following market rate of interest of: i. 6 percent. (4 marks) ii. 8 percent. (4 marks) iii. 12 percent. (4 marks) (b) Identify the types of bonds in question (a) (6 marks) (c) Explain the relationship between the bond value and its required rate of return. (7 marks)

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