You have been selected as a financial analyst for a mutual fund. Given the opportunity to invest in one of the three bonds listed below, which would you purchase? Assume an interest rate of 7%.

Bond	Face Value	Annual coupon rate	Maturity price
A	RM1,000	4%	RM990
B	RM1,000	7.5%	RM990
C	RM1,000	8.5%	RM990

b) Your client is not clear if a particular security is debt or equity. Explain the basic difference between debt and equity.

c) You have been asked to evaluate the share price for Tan Yachts Berhad. It has paid annual dividends of RM1.40, RM1.75, and RM2.00 a share over the past three years, respectively. The company now predicts that it will maintain a constant dividend of RM2.00 since its business has leveled off and sales are expected to remain relatively constant. Given the lack of future growth, you will only buy this stock if you can earn at least a 15% rate of return. What is the maximum amount you are willing to pay to buy one share today?

d) You are analyzing The Bell Telephone Companys share price. It is a new firm in a rapidly growing industry. The company is planning on increasing its annual dividend by 20% a year for the next four years and then decreasing the growth rate to 5% per year. The company just paid its annual dividend in the amount of RM1.00 per share. What is the current value of one share if the required rate of return is 9.25%?