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# On January 1, a company issues bonds with a par value of $300,000. The bonds mature in 5 years, and pay 8% annual interest, payable

On January 1, a company issues bonds with a par value of $300,000. The bonds mature in 5 years, and pay 8% annual interest, payable each June 30 and December 31. On the issue date, the market rate of interest for the bonds is 10%. Compute the price of the bonds on their issue date. Instructions Make sure that you indicate what you are using for your number of periods (n or p), what you are using for your interest per period(), and what factor (f) you are using for your calculation in order to receive possible partial credit for incorrect answers. Make sure that you present your answer in an understandable format. The following information is taken from present value tables: Present value of an annuity for 5 periods at 4% | |4.4518 Present value of an annuity for 5 periods at 5% | |4.3295 Present value of an annuity for 10 periods at 8.1109 4% Present value of an annuity for 10 periods at7.7217 5% Present value of 1 for 5 periods at 4% Present value of 1 for 5 periods at 5% Present value of 1 for 10 periods at 4% Present value of 1 for 10 periods at 5% 0.8219 .7835 0.6756 0.6139

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