On January 1, 2018, Anne Teak Furniture issued $100,000 of 8% bonds, dated January 1. Interest is payable semiannually on June 30 and December 31. The bonds mature in 10 years. The annual market rate for bonds of similar risk and maturity is 10%. What was the issue price of the bonds?

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11ea937b_35f7_474e_a419_d7ea0f41aa13_TB2599_00 Semiannual: 8%/2 = 4%. 10%/2 = 5% ^¥ 4% × $100,000 = $4,000. * PV of ordinary annuity of $1: n = 20; i = 5% **PV of $1: n = 20; i = 5%

On January 1, 2018, Anne Teak Furniture Issued $100,000 of 8