Problem:
Even though most corporate bonds in the United States make coupon payments semiannually, bonds issued elsewhere often have annual coupon payments. Suppose a German company issues a bond with a par value of €1,000, 20 years to maturity, and a coupon rate of 7.8 percent paid annually.
Required:
Question: If the yield to maturity is 8.9 percent, what is the current price of the bond?
Note: Please provide through step by step calculations.