Pakistan Cables offers 5-Year bonds with 8% coupon (semiannual interest payment). Redemption value is Rs: 1200. Inflation risk premium on these bonds is current inflation rate plus 2%, and default risk premium of Pakistan Cables is 3% followed by 2.5% of industry risk premium.

• Determine the annual interest for 5-Years bonds issued by Pakistan Cables? 
• What could be the impact of the above situation on coupon interest rate and discount rate on these bonds. 
• What could be the impact of above situation on coupon interest rate and discount rate on these bonds if the coupon on these bonds is Current inflation plus 5%.