ABC Inc has issued $15-$year bonds that make semiannual coupon payments at a rate of $5\mathrm{.}5$ percent. The current market rate for similar securities is $6\mathrm{.}5$ percent.

What is the current market value of one of these bonds?

Would you purchase one of these bonds if it was offered to you at $$925?$ Why?

What do you expect would happen to the bond$$s price if the market rate decreased to $5\%?$

What is your Effective Annual Yield if you purchase the bond at $$925$ and hold it to maturity?