Question: Question 3. Solve the following two problems. Use Excel, financial calculator, or PV and FV Tables. Show your work with the formulas and figures inserted

Question 3. Solve the following two problems. Use Excel, financial calculator,

Question 3. Solve the following two problems. Use Excel, financial calculator, or PV and FV Tables. Show your work with the formulas and figures inserted in them. (7 Marks) 1. What must be the present value of an AED 10,000 bond with a 9 percent coupon rate, semiannual coupons that has 8 years to maturity if the discount rate is 10 percent. (3 Marks) 2. A public shareholding announced that it is not going to pay dividends for the next 9 years. However, it also announced that it will pay AED 5 as a dividend to common stockholders in year 10 and the dividends will grow by 2 percent every year starting year 11. What price would you pay at present if the required rate of return is 7 percent. (4 Marks)

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