Rainbow Bridge Pet Care Centre is looking at issuing $ 200,000 of 5-year bonds in order to finance their small animal wing. The bonds have an interest rate of 5% with semi-annual interest payments. The day they go to issue the bonds, the market rate is at 4%.
Instructions
Determine how much Rainbow Bridge will bring in from the sale of these bonds.

Question

Quizplus · Accepted Answer

The Answer of Rainbow Bridge Pet Care Centre is looking at issuing $ 200,000 of 5-year bonds in order to finance their small animal wing. The bonds have an interest rate of 5% with semi-annual interest payments. The day they go to issue the bonds, the market rate is at 4%.
Instructions
Determine how much Rainbow Bridge will bring in from the sale of these bonds.

Rainbow Bridge Pet Care Centre Is Looking at Issuing