Pybus, Inc. is considering issuing bonds that will mature in
years with an annual coupon rate of
percent. Their par value will be
and the interest will be paid semiannually. Pybus is hoping to get a AA rating on its bonds and, if it does, the yield to maturity on similar AA bonds is
percent. However, Pybus is not sure whether the new bonds will receive a AA rating. If they receive an A rating, the yield to maturity on similar A bonds is
percent. What will be the price of these bonds if they receive either an A or a AA rating?
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