1. Discuss corporate bond interest in terms of cost of capital versus investor yields. Also, discuss municipal bond interest in terms of investor yields.
2. Madsen Motors's bonds have 7 years remaining to maturity. Interest is paid annually; they have a $1,000 par value; the coupon interest rate is 9.5%; and the yield to maturity is 12%. What is the bond's current market price? Round your answer to the nearest cent.