Question 3 20 Marks (a) Micron Industries is considering issuing a $20,000,000 15-year bond in early 2022, with an annual coupon rate of 4%, and semiannual interest payments. Required: If the company anticipates that the yield to maturity on the date of issue is expected to be 4.5%, given the company's credit ratings and current market conditions, how much would an investor bewilling to pay for $1,000 face value of this bond? (7 Marks) (b) Micron Industries is also considering a Class B issue of its common stock on the market via an Initial Public Offering (IPO) in late 2021. The company is expected to pay the following dividends over the next 4 years: $2.00, $3.00, $3.50 and $4.50. Thereafter, the company is expected to increase dividends by an annual rate of 6%. Required: Assuming investors would require a return of 12% on this riskier type of investment, how much would an investor pay for this share today? (10 Marks) (c) Micron Industries is also assiduously finalizing the issuance of its preference shares. The company plans to pay an annual dividend of $6.20 on each preferred share and anticipates investors required return to be around 10% Required: Compute the price at which Micron Industries should issue these preferred shares