Heron Ltd has an outstanding perpetual bond with a 7 percent coupon rate. The bonds make semi annual coupon payments. there is a 75 percent chance that the interest rate will be 9 percent and a 25 percent chance the interest rate will be 3 percent the one year interest rate at present is 6 percent.

What is the current price of the bond if there is no call provision?

What is the current price of the bond if the call provision is 120 over par value?