A healthcare company sold bonds that have a 10 year maturity, a 12% coupon rate with annual payments, and a $1,000 par value.

A. Suppose that 2 years after the bonds were issued, the required interest rate fell to 7 percent. What would the bonds value be?

B. Suppose that 2 years after the bonds were issued, the required interest rate rose to 13 percent. What would the bonds value be?

C. What would the value of the bonds three years after issue in each scenario above, assuming that interest rates stayed steady at either 7 percent or 13 percent?