Consol Bonds

Perpetual Life Corp. has issued consol bonds with coupon payments of $74. (Consols pay interest forever and never mature. They are perpetuities.)

a.	If the required rate of return on these bonds at the time they were issued was 12%, at what price were they sold to the public?

Price sold to the public

$

b.	If the required return today is 15.7%, at what price do the consols sell?

Current price

$