XYZ Corporation has issued XXX bonds worth RM1.2 million in Japan and denominated in Yen Japanese for 10 years, 7% and semi-annually payment dividend. The other bonds, 15 years ZZZ bonds worth RM1.5 million was issued 7 years ago at coupon rate of 6% and annually payment. ZZZ bond has issued in US denominated in Ringgit Malaysia. Market price for XXX bond is RM1200 and ZZZ is RM1050.

Required:

a) Determine what type of bonds has been issued by XYZ Corporation. Justify your answer.

(4 marks)

(CLO2:PLO6:C4)

b) Calculate the YTM according to interpolation methods for both bonds.

(8 marks)

(CLO2:PLO6:C4)

c) From (b), calculate the value for both bonds.