Complex Systems has an outstanding issue of $1,000 par-value bonds with a 9% coupon interest rate. The issue pays interest annually and has 16 years remaining to its maturity date.

a. If bonds of similar risk are currently earning a rate of return of 8%, how much should the Complex Systems bond sell for today?

b. Describe the two possible reasons why the rate on similar-risk bonds is below the coupon interest rate on the Complex Systems bond. c.If the required return were at 9% instead of 8%, what would the current value of Complex Systems' bond be?