Question: On January 1 , 2 0 2 4 , Ocean World issues $ 4 0 . 3 million of 8 % bonds, due in 1

On January

1, 2024,

Ocean World issues $

40.3

million of

8 %

bonds, due in

15

years, with interest payable semiannually on June

30

and December

31

each year. The proceeds will be used to build a new ride that combines a roller coaster, a water ride, a dark tunnel, and the great smell of outdoor barbeque, all in one ride.

Required:

1 -

.

If the market rate is

7 %,

calculate the issue price.

(

FV of $

1,

PV of $

1,

FVA of $

1,

and PVA of $

1)

1 -

.

Will the bonds issue at face amount, a discount, or a premium?

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