Question

On January 1, 2012, Central City issued a 20-year serial bond to finance improvements to the water distribution system. A total of $ 80,000,000 face value of bonds were issued with coupon and maturity rates as follows:


Central City received $ 80,500,000 from the bond issue. Use a spreadsheet program to find the NIC and TIC interest rates for the bond issue. What would the values for NIC and TIC be if the interest rate were 4.2 percent for the bonds with a maturity before 2026 and 5 percent for the bonds with a maturity of 2026 or later?


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  • CreatedDecember 19, 2014
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