Question: QUESTION 2 [20 MARKS] (a) Explain the FOUR (4) types of preference shares in Malaysia equities market. [8 marks] (b) The common stock of Nestle

QUESTION 2 [20 MARKS] (a) Explain the FOUR (4) types of

QUESTION 2 [20 MARKS] (a) Explain the FOUR (4) types of preference shares in Malaysia equities market. [8 marks] (b) The common stock of Nestle paid RM1.32 in dividends last year. Dividends are expected to grow at 8% p.a. for indefinite number of years. (0) If the current price is RM23.50, calculate the stocks' expected rate of retum. [2 marks] (ii) f your required rate of return is 10.5%, calculate the value of the stock for you. [2 marks] (iii) Should you make the investment? Explain. [2 marks] (c) Maybank announced 1 rights issue for every 5 shares already owned at RM12.00. The current market price is RM20.00 per share. Calculate the theoretical ex-rights price per share. [4 marks] (d) Explain the rights issue in the Malaysian equity market. m madral

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