SONIC has issued an ordinary coupon bond, shown in Table 2 below:

Bond	V (Vanilla)
Coupon Rate	5% per annum
Type of Coupons	Annual (end of year)
Years to Maturity	10
Par Value	$1,000
Credit Rating	AAA

The cost of debt capital is 8% per annum.

a) Calculate the value of Bond V

b) Briefly explain what does a credit rating of AAA mean.