Sampson food company has a 14% annual coupon interest rate on a $1,000 par value bond with 15 years left to maturity. Bonds of same maturity now sell to yield 12% return.

(a) How much would you be willing to pay for one of these bonds today? Why?

(b) If the bond is selling for $ 1,150 what is the yield to maturity?

(c) Will you buy this bond? Explain in detail what key factors you will consider in making your decision.