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A taxexempt bond was recently issued at an annual 7 percent coupon rate and matures 20 years from today. The par value of the bond

A taxexempt bond was recently issued at an annual 7 percent coupon rate and matures 20 years from today. The par value of the bond is $5,000.

If required market rates are 7 percent, what is the market price of the bond?

If required market rates fall to 3 percent and maturity is 20 years, what is the market price of the bond?

If required market rates rise to 14 percent and maturity is 20 years, what is the market price of the bond?

At what required market rate (7 percent, 3 percent, or 14 percent) does the above bond sell at a discount? At a premium?

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