Example $6\mathrm{.}2\mathrm{.}2$

A $20$ year bond with a face value of $$10,000$ pays interest at $j_2=$

$8\%$ and is redeemable at $105.$ After $6$ years, the bond is sold to an

investor who desires a yield of $j_2=7\%.$ What price does this

investor pay for the bond?