Air Destinations issues a bond due in 10 years with a stated interest rate of 6% and a face value of $500,000. Interest payments are made semi-annually. The market rate for this type of bond is 7%. What is the issue price of the bond? (Use Table 2 and Table 4, contained within a separate file.)
A) $537,194.
B) $464,471.
C) $359,528.
D) $500,000.
Answer: B
Air Destinations issues a bond due in 10 years with a stated interest rate of 6% and a face value of $500,000. Interest payments are made semi-annually. The market rate for this type of bond is 5%. What is the issue price of the bond (rounded to nearest whole dollar)? (Use Table 2 and Table 4, contained within a separate file.)
A) $537,194.
B) $464,469.
C) $538,972.
D) $500,000.
Answer: C
Air Destinations issues a bond due in 10 years with a stated interest rate of 6% and a face value of $500,000. Interest payments are made semi-annually. The market rate for this type of bond is 7%. What is the issue price of the bond (rounded to nearest whole dollar)? (Use a financial calculator or Excel)
A) $537,194.
B) $464,469.
C) $359,528.
D) $500,000.
Answer: B
Air Destinations issues a bond due in 10 years with a stated interest rate of 6% and a face value of $500,000. Interest payments are made semi-annually. The market rate for this type of bond is 5%. What is the issue price of the bond (rounded to nearest whole dollar)? (Use a financial calculator or Excel)
A) $537,194.
B) $464,469.
C) $538,973.
D) $500,000.
Answer: C
