Determine the price of a $300,000 bond issue under each of the following three independent assumptions: Assumption Maturity Interest...

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Issue price of Bond:

Present Value of $300,000	PVF n=10 period, i=7%	0.4440	$ 133,204
Present Value of $36, 000	PVAF n=10 period, i=7%	7.9427	$ 285,937
(300000*12%)
Issue Price of Bond			$ 419,140

Present Value of $300,000	PVF n=20 period, i=4%	0.4564	$ 136,916
Present Value of $18, 000	PVAF n=20 period, i=4%	13.5903	$ 244,626
(300000*6%)
Issue Price of Bond			$ 381,542

Present Value of $300,000	PVF n=40 period, i=5%	0.1420	$ 42,614
Present Value of $18, 000	PVAF n=40 period, i=5%	17.1591	$ 308,864
(300000*6%)
Issue Price of Bond			$ 351,477

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Other questions asked by students

Assumption	Maturity	Interest Paid	Stated Interest Rate	Effective (or Market) Interest Rate
1	10 years	annually	7%	12%
2	10 years	semiannually	8%	12%
3	20 years	semiannually	10%	12%