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Pybus, Inc. is considering issuing bonds that will mature in 22 years with an annual coupon rate of 11 percent. Their par value will be

Pybus, Inc. is considering issuing bonds that will mature in 22 years with an annual coupon rate of 11 percent. Their par value will be $1, 000, and the interest will be paid semiannually. Pybus is hoping to get a AA rating on its bondsand, if itdoes, the yield to maturity on similar AA bonds is 7 percent. However, Pybus is not sure whether the new bonds will receive a AA rating. If they receive an Arating, the yield to maturity on similar A bonds is 8 percent. What will be the price of these bonds if they receive either an A or a AArating?

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