Must show detailed steps. Final answer only will result in zero point.

Question $26(10$ points$)$

Merrick Inc. issued a $15-$year bond, with a coupon rate of $6\%$ paid semi$-$annually. The bond was sold at par value.

a$.$ Two and a half years after the bonds are issued, bonds of similar quality are selling with a yield of $5\%.$ What is the market price of Merrick$$s bonds at this time?

b$.$ Suppose you purchase the bonds at the two and a half year point $($for the price calculated in $($a$).$ Three and half years later, this bond is traded in the market at $$1115.$ Barrick Inc., a direct competitor of Merrick Inc., wants to issue a new bond at that time. What is the issuance price of the new bond if the new bond has a time to maturity of $9$ years with a coupon rate of $5\%$ paid semi$-$annually? is this question from this chapter