Question: Can you please explain how part B is calculated using a financial calculator? Apple, AIG. and Vanguard issue a $1,000 par value bond. Your friend

 Can you please explain how part B is calculated using a

Can you please explain how part B is calculated using a financial calculator?

Apple, AIG. and Vanguard issue a $1,000 par value bond. Your friend is thinking of purchasing these bonds, but is unsure of how to analyze. She comes to you for help with the following. A) See the information below. Assuming interest is paid on a yearly basis, calculate the values of the bonds when your friend's required rate of return is as follows: Apple 6%, AIG 8%, and Vanguard 10%. Apple 5.25 30 AIG 4.25 Coupon Interest rate Years to maturity Vanguard 4.75 5 10 B) Assuming the bonds are selling for the following amounts. What are the expected rates of return for each bond? APPLE - $1,100 AIG - $1,030 Vanguard - $1,015 C) What change occurs in value if (1) the required rate of return increases by 2% (2) the required rate of return decreases by 2%? D) Should you recommend your friend to buy the bonds? Why or why not? HINT: Before you answer, fill out the table below. It will help you hone in on the information you need to move forward. You can find how to do this on page 246-248 in our text. Apple AIG Vanguard Coupon interest rate Interest payment PMT- Years to Maturity Nper- par value FV

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