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Java Spirit Ltd. is seeking financing for a new initiative it is contemplating. It intends to issue a new series of bonds on January 1,

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Java Spirit Ltd. is seeking financing for a new initiative it is contemplating. It intends to issue a new series of bonds on January 1, 2022, with a $1,000 par value. They are expected to mature in 25 years and will have a coupon rate of 7%, paid semi-annually. a) What is the expected maturity date of the bonds? b) What is the expected price of the bond on December 31, 2029, if interest rates were 10% ? How would the bonds be classified? c) What is the expected price of the bonds on January 1, 2038, if interest rates were 7% ? How would these bonds be classified? d) What is the bond's expected price on June 30,2042 , if interest rates had fallen to 5% ? How would these bonds be classified? e) What lessons can we learn from parts (b) to (d) above? f) What is the bond's yield to maturity (YTM) on July 1, 2044, if the bond sold for $988 on that date

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