Assume the following information for the next TWO questions: Texas Republic, Inc. has issued a 7% fixed annual coupon bond with 15 years to maturity having a $1,000 par value currently priced at $838.78.

14. Assume you purchase Texas Republics bond when it has only 8 years remaining until maturity and that you will not sell it prior to maturity. Further, when you purchased the bond, it was priced to yield 6% (YTM). What price will you pay for the bond?

A. $1,000

B. $1,056

C. $889

D. $1,062

E. $1,270

15. Assume you purchase Texas Republics bond when it has only 8 years remaining until maturity and that you will not sell it prior to maturity. Further, when you purchased the bond, it was priced to yield 6% (YTM). What is your terminal wealth if you hold it until maturity and rates do not change?

A. $1,693

B. $1,070

C. $1,533

D. $1,725

E. $2,050