On January 1, a company issues 8%, 5-year, $300.000 bonds that pay interest semiannually. On the issue date, the annual market rate of interest is 6%. The following information is taken from present value tables Present value of an annuity (series of payments) for 10 periods at 3% Present value of an annuity (series of payments) for 10 periods at 4% Present value of 1 (single sum) due in 10 periods at 3% Present value of 1 (single sum) due in 10 periods at 4% What is the issue (selling) price of the bond? Multiple Choice $320.560 80 $325,59240 $40217162 8.5302 8.1109 0.7441 0.6756
On January 1, a company issues 8%, 5-year, $300.000 bonds that pay interest semiannually. On the issue date, the annual market rate of interest is 6%. The following information is taken from present value tables Present value of an annuity (series of payments) for 10 periods at 3% Present value of an annuity (series of payments) for 10 periods at 4% Present value of 1 (single sum) due in 10 periods at 3% Present value of 1 (single sum) due in 10 periods at 4% What is the issue (selling) price of the bond? Multiple Choice $320.560 80 $325,59240 $40217162 8.5302 8.1109 0.7441 0.6756
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:On January 1, a company issues 8%, 5-year, $300.000 bonds that pay interest semiannually. On the issue date, the annual market rate of interest is 6%,. The
following information is taken from present value tables
Present value of an annuity (series of payments) for 10 periods at 3%
Present value of an annuity (series of payments) for 10 periods at 4%
Present value of 1 (single sum) due in 10 periods at 3%
Present value of 1 (single sum) due in 10 periods at 4%
What is the issue (selling) price of the bond?
Multiple Choice
$320 560 80
$325,592.40.
$40317162
8.5302
8.1109
8.7441
0.6756
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