Question: Your company issues 8.5% coupon bonds with a face value of $1,000. Suppose these bonds have 17 years to maturity, make semiannual payments, and have

Your company issues 8.5% coupon bonds with a face value of $1,000. Suppose these bonds have 17 years to maturity, make semiannual payments, and have a yield to maturity of 11%.

6a. What is the current price of the bonds?

6b. If interest rates fall to 7%, what would the price be?

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