What will be the dollar return to the investor if they hold the COD until maturity

1. The National Australia Bank wants to obtain short-term funds on the money market and issues a 30 day Certificate of deposit (COD) to a wholesale investor. The amount of the deposit is $20,000,000 and the relevant rate is 4.5% p.a. a) What is the Face Value of one of the Certificates of Deposit? What does this value mean? (5 marks) b) What will be the dollar return to the investor if they hold the COD until maturity? (3 marks) c) If the bank wanted to raise $100,000,000 how many of these COD’s would they issue? (2 marks) 2. The Commonwealth Bank issues bonds on the capital market to raise financing for its loans. a) How much financing will the Commonwealth Bank raise if it issues 500 5-year bonds today that pay an annual coupon of 6% and have a face value of $1000 if yields on bonds of similar risk and maturity are 4%? (6 marks) b) What will happen to the price of the bonds in a) if 1 year from now the credit rating of the Commonwealth Bank is increased from AA to AAA? Why? (4 marks) 3. The ANZ Bank (Share code: ANZ.AX) expects to pay a dividend of $0.91 today and dividends are expected to grow at 6% forever. The required return on ANZ shares is 9%. Based on this information would you buy the share today? (Base your answer on current market data for ANZ shares)