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Compute the price of the bonds on their issue date

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Question - Alan Company issues bonds with a par value of $800,000 on their issue date. The bonds mature in 5 years and pay 6% annual interest in semiannual payments. On the issue date, the market rate of interest (annual) is 8%.

Compute the price of the bonds on their issue date (rounded to the nearest dollar).

A. $736,130

B. $698,938

C. $640,305

D. $735,464

Reference no: EM131631801

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