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Question 6 1 pts A firm has issued a callable bond with maturity of 9...

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Question 6 1 pts A firm has issued a callable bond with maturity of 9 years and coupon rate of 5.9% (interest paid annually). Yields can immediately change to 8.9% or 2.9% with equal likelihood, and once they change they will remain at that level forever. All rates are annualized assuming periodicity of 1 (i.e. annual compounding). The issuer can call the bond immediately at a call price of 109. What is the fair price for this bond? (If your solution is $4.44 then enter "4.44" as the answer. Precision is 0.01+/- 0.02.)

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