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Gingko Inc. issued bonds with a face value of $\$100,000$, a rate of 7%, and a 10-yearterm for $\$103,000$. From this information, we know that the market rate of interest was ________.A. more than 7%B. less than 7%C. equal to 7%D. equal to 1.3%

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Chapter 13

Long-Term Liabilities

Section 3

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Okay, so we have a bond with a face value of 10,000. So our formula for face value that is a is equal to P. Times one plus, Archie. Okay, so are face value. That is 10,000. And now our principle is at a rate of 5988.2 and then that's for 10 years. So we ask yourself, All right, so we have 10,000 divided by 5988.2 Okay. And now was to track that by one and then divide by 10 and then we get a rates of 0.67 which is equal to 6.7%.

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