QUESTION #9 is trading at Toronto Stock Exchange, TSX, Suppose that at this moment, the common stock of ABC Ltd. is trading at Toronto and Tokyo Stock Exchange, TSE, as follows: (Trading price is on per share basis) TSX TSE Bid Ask Bid C$12 C$12.05 The exchange rate at this moment is: CS.01 - 11.0 Ask 1,190 1,150 a. Is there arbitrage opportunity? If so, what is it? 6. Assume no brokerage commission, find arbitrage profit of simultaneously buying and se million shares. c. If brokerage commission is 0.5% of the trading price at both locations, does the arbitrage opportunity still exist? QUESTION #10 Assume three equivalent bonds, call them A, B and C. Each of these bonds has term-to-maturity of 10 years, coupon rate of 8% per annum, the face value of $1,000 and the coupon payments semi-annual. The difference among A, B and Care: A is non-callable and non-convertible, B is callable and non- convertible and C is both callable and convertible. The annual yields-to-maturity of A, B and C are 10%, 12%, and 9% respectively. Find: The value of the call feature to the issuer, and (ii) The value of the conversion feature to the investor