Question 10
4pts
The face value of a bond is $50000. Its stated rate is 6% and the term of the bond is five years. The bond pays interest semiannually. At the time of issue, the market rate is 8%. What is the present value of the bonds at issuance?
Present value of $1:
0.784
0.747
0.71
0.06
0.790
0.73
0.155
0.05
0.703
Present value of ordinary annuity of $1:
5%
6% 4212
4.329
100
3.99
5.242
5.076
1.917
6.002
7435
8111
$49,986
$46,029
$51,500
$45,967