Tesco PLC is planning to issue a 9-year maturity bond with 20 warrants attached and a bond yield to maturity of 4%. Each warrant is expected to worth $2.5.

(a) If the coupon rate for this 9-year maturity bond is at 3%, how much capital would Tesco PLC be able to raise for every bond with 25 warrants attached to each share of bond? (b) Suppose Tesco PLC plans to sell each share of this 9-year bond with only 20 warrants attached at par value ($1,000) today. What is the coupon rate for this Tesco bond?