Refer to the information in QS 10-19 for Vodafone Group Plc. The following price quotes relate to its bonds payable. The price quote indicates that the 4.625% bonds have a market price of 111.67 (111.67% of par value), resulting in a yield to maturity of 1.710%.

a. Assuming that the 4.625% bonds were originally issued at par value, what does the market price reveal about interest rate changes since bond issuance? (Assume that Vodafone€™s credit rating has remained the same.)
b. Does the change in market rates since the issuance of these bonds affect the amount of interest expense reported on Vodafone€™s income statement? Explain.
c. How much cash would Vodafone need to pay to repurchase the 4.625% bonds at the quoted market price of 111.67? (Assume no interest is owed when the bonds are repurchased.)
d. Assuming that the 4.625% bonds remain outstanding until maturity, at what market price will the bonds sell on the due date in 2018?

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Contract Rate (coupon) Market Rate (YTM) Maturity Date Price 4.625% 15-Jul-2018 111.67 1.710% ........