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Part b 15 marks You are evaluating an opportunity to invest in $1Million bond issued by ABG Inc, a public company with very good credit

Part b 15 marks

You are evaluating an opportunity to invest in $1Million bond issued by ABG Inc, a public company with very good credit rating. The bond matures in 10 years, promises $30,000 every six months and the current market interest rate is 8%.

A. What is the most you would be willing to pay for this bond? 10 Marks

B. Explain the difference, if any, between your value and the stated value of the bond 5 Marks

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