Bonds in the amount of $100,000 with a life of ten years were issued by Focus Company.If the face rate is 6% and interest is paid semiannually,what would be the total amount of interest paid over the life of the bonds?

Question

Quizplus · Accepted Answer

The total amount of interest paid over the life of the bonds is calculated by multiplying the face value ($100,000) by the annual interest rate (6%) and then by the number of years (10). Since interest is paid semiannually, the annual interest rate is divided into two payments per year, but this does not change the total amount of interest paid over the life of the bond. Therefore, $100,000 * 6% * 10 = $60,000.

Bonds in the Amount of $100,000 with a Life of Ten