You have a 25-year maturity, 10% coupon, 10% yield bond with a duration of 10 years and a convexity of XXXXXXXXXXIf the interest rate were to fall 125 basis points, your predicted new price for the...

1. You have a 25-year maturity, 10% coupon, 10% yield bond with a duration of 10 years and a convexity of 135.5. If the interest rate were to fall 125 basis points, your predicted new price for the bond (including convexity) is

You are told by your investment advisor that Laduma Co. is expected to earn R5 per share next year, R6 per share the following year and that thereafter earnings are expected to grow by 8 percent per year. The dividend payout ratio is 60 percent and the required rate of return on Laduma shares is 15 percent.  If the current share price is R40, would you expect your adviser to make a buy, hold or sell recommendation?  If transaction costs are R2,50 per share, would you follow his advice?