8. Several major companies (like Disney and AT&T) have issued "Century Bonds." These bonds pay regular semi-annual coupons, but do not mature until 100 years after they are issued. Some critics have stated that there is huge risk that you won't get the principal repaid because you just can't predict what will happen to the company in 100 years. For this question assume that the company has just issued a $1000 par, 8% coupon bond with semi-annual payments. a) If current yield to maturity for these bonds are 8%, what is the current price of the bond? What is the present value of the face value only? Finally, what proportion of the bond's price does the principal repayment make-up? b) What is the present value of the first 40 years of coupon payments? What proportion of the bond's price does the first 40 years coupon payment make-up? c) Suppose you think you can live for another 60 years, by which time, due to the loose monetary policy of the Fed, the yield to maturity of the same bond will be 20%. How much will the bond be worth at that time?