Because market interest rates were near all-time lows at 4% per year, a hand tool company decided

Question:

Because market interest rates were near all-time lows at 4% per year, a hand tool company decided to call (i.e., pay off) the high-interest bonds that it issued 3 years ago. If the interest rate on the bonds was 9% per year, how much does the company have to pay the bond holders?
The (principal) of the bonds is $6,000,000.

Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the...