You recently inherited TT$750,000 and are trying to decide between one of three investmentoptions: the purchase of corporate bonds, the purchase of stock, or the purchase of a smallbusiness.Calculate the value of the following investments:

a. Natural Flour Mill, a grain grinding manufacturer has an outstanding bond that pays a coupon

interest of 9% annually.The bond has a par value of $1,000 and will mature in the next 3 years.

What is the bond's value at maturity, if the required rate of return for similar investments iscurrently 7%?

b. Bess Juice Limited's expects to pay a dividend per share of $2.50 at the end of January 2019 toits ordinary shareholders.Given the company's plans to expand its export markets to includethree additional companies, analysts believe the company's dividends will grow at a constantrate of 5% per year for the foreseeable future.What price should you pay for one of BessJuice's ordinary shares if the required rate of return for similar investments is currently 7%? (3

marks)

c. Renu Company Ltd. currently earns after-tax cash flow of $50,000 per year.On the basis of areview of similar risk investment opportunities, you expect to earn 7% rate of return on theproposed purchase.What price should you pay for the firm if after-tax cash flows of the firmare expected to remain at $50,000 per year for the first two years, followed by a constantannual growth rate of 3% from year 3 onwards?