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On July 1, 2013, $6 million face amount of 7%, 10 year bonds were issued. The bonds pay interest on an annual basis on June 30 each year. The market interest rates were slightly higher than 7% when the bonds were sold.Required:a. How much interest will be paid annually on these bonds?b. Were the bonds issued at a premium or discount? Explain.c. Will the annual interest expense on these bonds be more than, equal to, or less than the amount of interest paid each year? Explain your answer.
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