Question: Do the process: 2. PREPA is offering a $ 45 Bonus, payable semi-annually, for the next 20 years. The prevailing market interest rate is 8%.

Do the process:

2. PREPA is offering a $ 45 Bonus, payable semi-annually, for the next 20 years. The prevailing market interest rate is 8%. What is the value of the Bonus? Present value $ ____________ is sold with a premium or discount ______________

3. El Sol Inc. is offering its bonds on the market at 8% annual interest but ensures that they are paid semi-annually for 7 years. The prevailing market interest rate is currently 10%. What is the value of the bonds? Present value $ __________ sold at a premium or discount____________

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