A bond has the following features:

Coupon rate of interest (paid annually): 10 percent

Principal: $1,000

Term to maturity: 12 years

What will the holder receive when the bond matures?

If the current rate of interest on comparable debt is 8 percent, what should be the price of this bond? Assume that the bond pays interest annually. Use Appendix B and Appendix D to answer the question. Round your answer to the nearest dollar.

$

Would you expect the firm to call this bond? Why?

, since the bond is selling for a .

If the bond has a sinking fund that requires the firm to set aside annually with a trustee sufficient funds to retire the entire issue at maturity, how much must the firm remit each year for twelve years if the funds earn 8 percent annually and there is $90 million outstanding? Use Appendix C to answer the question. Round your answer to the nearest dollar.

$