A $$1,000$ par value bond was issued $30$ years ago at an $11$ percent coupon rate. It currently has $15$ years remaining to maturity. Interest rates on similar debt obligations are now $14$ percent. Use Appendix B and Appendix D$.($Round $"$PV Factor" ro $3$ decimal places. Do not round intermediate calculations. Round the final answers to $2$ decimal places.$)$

a$.$ Compute the current price of the bond using an assumption of semiannual payments.

Price of the bond

$

b$.$ If Mr$.$ Mitchell initially bought the bond at par value, what is his percentage loss $($or gain$)?($Input the amount as positive value.$)$

Percenta $\%$

c$.$ Now assume Mrs$.$ Gordon buys the bond at its current market value and holds it to maturity, what will be her percentage return? $($Input the amount as positive value.$)$

Percentage

$\%$

d$.$ Although the same dollar amounts are involved in parts $b$ and $c,$ explain why the percentage gain is larger than the percentage loss.

Investment is larger

Investment is smaller