Junk Corp.’s high-yield b

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Junk Corp.’s high-yield bond has the following features:Principal                 $1,000Coupon                        10%Maturity                         5 yearsSpecial features: Company may extend the life of the bond to 10 yearsa.If interest rates are currently 12 percent on comparable high-yield securities and are not expected to change, what is the price of this bond?b. If interest rates are currently 9 percent on comparable high-yield securities and are not expected to change, what is the price of this bond?c. If interest rates are currently 9 percent on comparable high-yield securities but the investor has no forecast as to future rates, what is the possible range of prices for this bond?

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