Suppose a seven-year, $1,000 with a 5.92% coupon rate and semiannual coupons is trading with a yield to maturity of 3.68% (please answer both questions, part a and b)

a. Is this bond currently trading at a discount, at par, or at a premium? Select one option below:

• At a premium because the yield to maturity is greater than the coupon rate.
• At a discount because the coupon rate is greater than the yield to maturity.
• At par because the coupon rate is equal to the yield to maturity.
• At a premium because the coupon rate is greater than the yield to maturity.

b. If the yield to maturity of the bond rise to 4.29% (APR with semiannual compounding), at what price will the bond trade?