Suppose a $4-$year, $$1,000$ bond with a $7\mathrm{.}09\%$ coupon rate and annual coupons is trading with a yield to maturity of $5\mathrm{.}25\%.$

a$.$ Is this bond currently trading at a discount, at par, or at a premuim? Explain.

b$.$ If the yield to maturity of the bond rises to $6\mathrm{.}12\%($with annual coupons$),$ at what price will the bond trade?

The bond is currently trading... $($Select the best choice below.$)$

A$....$ at a discount because the coupon rate is greater than the yield to maturity

B$....$ at a premium because the yield to maturity is greater than the coupon rate.

C$....$ at par because the coupon rate is equal to the yield to maturity

D$....$ at a premium because the coupon rate is greater than the yield to maturity

b$.$ If the yield to maturity of the bond rises to $6\mathrm{.}12\%($with annual coupons$),$ at what price will the bond trade?

The bond will trade for $

$($Round to two decimal places.$)$