(a) Quantum Corporation has two different bonds currently outstanding. Bond M has a face value of K20,000 and matures in 20 years. The bond makes no payments for the first six years, then pays K800 every six months over the subsequent eight years, and finally pays K1,000 every six months over the last six years. Bond N also has a face value of K20,000 and a maturity of 20 years, it makes no coupon payments over the life of the bond. If the required return on both these bonds is 8 percent compounded semiannually, what is the current price of Bond M and Bond N? (20 marks) (b) Linda Jackson, a financial analyst at Ken and Bradley, a leading real estate firm, is thinking about recommending that Ken and Bradley invest in a piece of land that costs K85,000. She is certain that next year the land will be worth K91,000, a sure K6,000 gain. Given that the guaranteed interest rate in the bank is 10 percent, should Kern and Bradley undertake the investment in land? (5 marks) Total (25 marks) QUESTION FIV (a) Why is the goal of financial management to maximize the current share price of the company's stock? In other words, why isn't the goal to maximize the future share price? (10 marks) (b) Who owns a corporation? Describe the process whereby the owners control the firm's management. What is the main reason that an agency relationship exists in the corporate form of organization? In this context, what kinds of problems can arise? (15 marks)