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13. You buy an 8% coupon bond. It matures in 5 years and pays annual coupons. When you buy the bond, the market interest rate

13. You buy an 8% coupon bond. It matures in 5 years and pays annual coupons. When you buy the bond, the market interest rate is 8%. You decide to sell the bond 1-year later, when the market interest rate is 7%.

a. What is the beginning price of the bond (the buy price)?

b. What is the price of the bond when you decide to sell it (ending price)?

Please Explain!!

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