A firm issues

ten-year

bonds with a coupon rate of

6.4%,

paid semiannually. The credit spread for this firm's

ten-year

debt is 0.8%. New

ten-year

Treasury notes are being issued at par with a coupon rate of

3.1%.

What should the price of thefirm's outstanding

ten-year

bonds be per $100 of face value?

A.

$120.54

B.

$144.65

C.

$96.43

D.

$168.75