. How many years will it take to pay off a GH11,000 loan with a GH1,241.08 annual payment and a 5% interest rate? A. 6 years B. 12 years C. 24 years D. 48 year

Question 2. You are given the following information about two companies both entirely financed by equity Tee Ltd. Jee Ltd. Ex-div market price per share (GH) 3.42 0.65 Total Current Dividend (GH) 6,158 48,130 Total Dividend 5years ago (GH) 2,473 37,600 Total number of shares 150,000 500,000 a. Calculate the dividend per share of the two companies 2marks b. The growth in the dividend for the two companies. 2m

3. (a) Five years ago Gasoo Ltd issued 12% irredeemable debenture at their par value of GH100. The current market price of these bonds is GH94. The company pays corporation tax at a rate of 30%. Calculate the companys current cost of debenture. 3marks (b) The Treasury bill rate is 24% p.a. and the expected rate of returns on the equity of your firm is 35% p.a. If the expected return on the market portfolio is 30%, what is the beta of your company? 3marks (c) The government of Ghana is about to issue an irredeemable bond with a face value of GH1,000 per bond and coupon interest rate of 15% p.a. If the cost of the bond is 18% p.a.; (i) What will be the market price of this bond? 3marks (ii) If the bond was issued by a company located on the moon, will you pay the same price as in (i) above? Explain. 1mark