Sand Explorers issues bonds due in 10 years with a stated interest rate of 7% and a face value of $200,000. Interest payments are made semi-annually. The market rate for this type of bond is 8%. Using present value tables, calculate the issue price of the bonds.
A) $139,609.
B) $186,410.
C) $214,877.
D) $200,000.

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Quizplus · Accepted Answer

11ea937b_35f7_e393_a419_8b6de4cdfa15_TB2599_00 ^¥$200,000 × 7% × ½ year = $7,000 *Table 2, i = 4%, n = 20 **Table 4, i = 4%, n = 20

Sand Explorers Issues Bonds Due in 10 Years with a Stated