SECTION B. Section A: Answer ALL questions. Question 1 Revenue Ltd has $1,000 par value bonds outstanding at 14% coupon interest. The bonds will mature in 20 years. Compute the current price of the bonds if the present yield to maturity is 11 percent. (5 marks) (b) Bonds issued by Oil and Gas Company have a par value of $1,000. The bonds are currently selling for $850. They have 10 years remaining to maturity. The annual interest payment is 8 percent. Compute the yield to maturity of the bonds. (5 marks) (c) Mr. Covid is creating a college investment fund for his daughter. He will put in $1,000 per year for the next 15 years and expects to earn a 6% annual rate of return. How much money will his daughter have when she starts college? (5 marks) Mr. Woohan believes he will need $60,000 annual income during retirement. If he can achieve a 6% return during retirement and believes he will live 20 years after retirement, how much does he need to save by the time he retires? (5 marks) (d) (e) Ms. Moodine will pay out $6,000 at the end of the year 2, 88,000 at the end of year 3, and receive $10,000 at the end of year 4. With an interest rate of 13 percent, what is the net value of the payments vs. receipts in today's dollars? (5 marks) (Total: 25 marks) MacBook Air FIN 2102/Page 4 of 4 Section B: Answer ALL questions. Question 1 (a) How does effective working capital management contribute to attaining organizational objectives? Discuss with some examples. (10 marks) (b) Explain the THREE (3) key activities of a financial manager in a large corporation and how these key activities relate to shareholders' wealth maximization. Include an example for each key activities. (15 marks) I (Total: 25 marks) The End Formatted/FIN2702 APR 20.20 Wisum MacBook Air SECTION B. Section A: Answer ALL questions. Question 1 Revenue Ltd has $1,000 par value bonds outstanding at 14% coupon interest. The bonds will mature in 20 years. Compute the current price of the bonds if the present yield to maturity is 11 percent. (5 marks) (b) Bonds issued by Oil and Gas Company have a par value of $1,000. The bonds are currently selling for $850. They have 10 years remaining to maturity. The annual interest payment is 8 percent. Compute the yield to maturity of the bonds. (5 marks) (c) Mr. Covid is creating a college investment fund for his daughter. He will put in $1,000 per year for the next 15 years and expects to earn a 6% annual rate of return. How much money will his daughter have when she starts college? (5 marks) Mr. Woohan believes he will need $60,000 annual income during retirement. If he can achieve a 6% return during retirement and believes he will live 20 years after retirement, how much does he need to save by the time he retires? (5 marks) (d) (e) Ms. Moodine will pay out $6,000 at the end of the year 2, 88,000 at the end of year 3, and receive $10,000 at the end of year 4. With an interest rate of 13 percent, what is the net value of the payments vs. receipts in today's dollars? (5 marks) (Total: 25 marks) MacBook Air FIN 2102/Page 4 of 4 Section B: Answer ALL questions. Question 1 (a) How does effective working capital management contribute to attaining organizational objectives? Discuss with some examples. (10 marks) (b) Explain the THREE (3) key activities of a financial manager in a large corporation and how these key activities relate to shareholders' wealth maximization. Include an example for each key activities. (15 marks) I (Total: 25 marks) The End Formatted/FIN2702 APR 20.20 Wisum MacBook Air