Question

Fourthedition Township is issuing a 30-year bond with a face value of $ 50,000,000 and a stated annual interest rate of 4 percent. The city will make interest payments twice a year.
1. Calculate the semiannual interest payment.
2. Calculate how much Fourthedition Township will receive from the bond offering under the following conditions:
a. Market interest rates remain unchanged at the time of the offering.
b. Market interest rates increased to 4.2 percent at the time of the offering.



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  • CreatedDecember 19, 2014
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