Question: Assume the same information as in BEPV.9, except that the market interest rate is 6% instead of 5%. In this case, how much can New

Assume the same information as in BEPV.9, except that the market interest rate is 6% instead of 5%. In this case, how much can New Line expect to receive from the sale of these bonds?

Data from BEPV.9

New Line Railroad Co. is about to issue $100,000 of 10-year bonds that pay a 5.5% annual interest rate, with interest payable semi-annually. The market interest rate is 5%. How much can New Line expect to receive for the sale of these bonds?

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