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Calculate at what price the bonds are issued

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Question - Calculating Bond Issue Price

On December 31, 2018, University Theatres issued $500,000 face value of bonds. The stated rate is 8%, and interest is paid semiannually on June 30 and December 31. The bonds mature in 15 years.

Required:

a. Assuming the market rate of interest is 6%, calculate at what price the bonds are issued.

b. Assuming the market rate of interest is 10%, calculate at what price the bonds are issued.

Reference no: EM131737407

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