Question 7 6 pts The term structure of interest rates is flat at 5.1%, but rates could change immediately to 7.1% or 3.1 % with probability of 0.86 and 0.14 , respectively, and stay at that level forever. You purchase a callable bond with 29 years to maturity and 5.1% coupon paid annually. The callable bond can be called at $ 102 immediately. Keep ALL calculations rounded to 4 decimal places. Then ONLY round up to 2 decimal places at the VERY END. If you get 1.1234 at the VERY END, then write 1.12 The price of the callable bond is $ The price of the embedded call option is $ The yeild spread of the callable bond over an otherwise straight bond is