Suppose a$$ seven$-$year, $ $1000$ bond with an $8\mathrm{.}1\%$ coupon rate and$$ semi$-$annual coupons is trading with a yield to maturity of $6\mathrm{.}34\%.$

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

b$.$If the yield to maturity of the bond rises to $7\mathrm{.}41\%($APR with$$ semi$-$annual compounding$),$ what price will the bond trade$$ for?

Question content area bottom

Part $1$

a$.$Is this bond currently trading at a$$ discount, at par or at a$$ premium? Explain.$($Select the best choice$$ below.$)$

A$.$

Because the yield to maturity is less than the coupon$$ rate, the bond is trading at a discount.

B$.$

Because the yield to maturity is greater than the coupon$$ rate, the bond is trading at a premium.

C$.$

Because the yield to maturity is less than the coupon$$ rate, the bond is trading at a premium.

D$.$

Because the yield to maturity is greater than the coupon$$ rate, the bond is trading at par.

Part $2$

b$.$The new price of the bond is $$$

$$

enter your response here. $($Round to the nearest$$ cent.$)$