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Issue Price The following terms relate to independent bond issues: 640 bonds; $1,000 face value; 8%...

Issue Price

The following terms relate to independent bond issues:

640 bonds; $1,000 face value; 8% stated rate; 5 years; annual interest payments

640 bonds; $1,000 face value; 8% stated rate; 5 years; semiannual interest payments

810 bonds; $1,000 face value; 8% stated rate; 10 years; semiannual interest payments

2,110 bonds; $500 face value; 12% stated rate; 15 years; semiannual interest payments

Required:

Assuming the market rate of interest is 10%, calculate the selling price for each bond issue. If required, round your intermediate calculations and final answers to the nearest dollar.

Situation Selling Price of the Bond Issue
a. $
b. $
c. $
d. $

Solutions

Expert Solution

a)

b)

c)

d)

Situation Selling Price of the Bond Issue
a $                                            591,360 =640*924
b $                                            590,720 =640*923
c $                                            708,750 =810*875
d $                                        1,217,470 =2110*577

ekkarill92 answered 1 year ago
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