Assume HCA sold bonds that have a ten-year maturity, a 13 percent coupon rate with annual payments, and a $1,000 par value.
a. Suppose that two years after the bonds were issued, the required interest rate fell to 12 percent. What
would be the bond's value?
b. Suppose that two years after the bonds were issued, the required interest rate rose to 14 percent. What
would be the bond's value?