The USgovernment Will Pay AirSys $2,500,000 Each Six Months, Equal to to 2.5

The U.S.government will pay AirSys $2,500,000 each six months, equal to 2.5% of the $100 million face amount of the treasury bonds (5% annual coupon rate, paid in two installments each year) , and will repay the $100 million at the end of five years.At the time AirSys purchases the bonds, the market prices these bonds to yield AirSys 6% annually (3% each six months) .The bonds are classified as held to maturity. AirSys will pay an amount equal to _____ for the bonds.

A) present value of an annuity of $2.5 million for 10 periods plus the present value of $100 million paid at the end of 10 periods, both cash flows discounted at 3% per period
B) present value of an annuity of $5.0 million for 5 periods plus the present value of $100 million paid at the end of 5 periods, both cash flows discounted at 6% per period.
C) present value of an annuity of $2.5 million for 10 periods plus the present value of $100 million paid at the end of 10 periods, both cash flows discounted at 2.5% per period.
D) present value of an annuity of $5.0 million for 5 periods plus the present value of $100 million paid at the end of 5 periods, both cash flows discounted at 5% per period.
E) the future value of cash flows totaling $125 million