Pretika Holdings Berhad is a property developer company in Malaysia, due to high demand of property, the company has dec
Posted: Tue Nov 23, 2021 8:50 am
Pretika Holdings Berhad is a property developer
company in Malaysia, due to high demand of property, the company
has decided to build up a new township which located at Bangi. The
project’s estimated cost is RM750 million and they were planning to
finance using debt which by issuing bond. The bond has a par value
RM1,000 with 10 percent coupon rate and will mature in 10 years.
Dr. Keertan is a retail investor and he has decided to buy the
bond.
Calculate the value of bond (Vb) if the required rate of
return is 8 percent.
(5
marks)
Determine the new value of bond (Vb) if the market
rate has increased to 12 percent.
(5 marks)
Define Yield to Maturity (YTM) in bond
investment.
(3 marks)
company in Malaysia, due to high demand of property, the company
has decided to build up a new township which located at Bangi. The
project’s estimated cost is RM750 million and they were planning to
finance using debt which by issuing bond. The bond has a par value
RM1,000 with 10 percent coupon rate and will mature in 10 years.
Dr. Keertan is a retail investor and he has decided to buy the
bond.
Calculate the value of bond (Vb) if the required rate of
return is 8 percent.
(5
marks)
Determine the new value of bond (Vb) if the market
rate has increased to 12 percent.
(5 marks)
Define Yield to Maturity (YTM) in bond
investment.
(3 marks)