Chinchilla Climbers recently issued bonds with a face value of $12,000,000 and a coupon rate of 6% for 15 years. The market rate of interest is 4%.
A. Compute the market value of the bonds if interest is paid annually.
B. Computer the market value of the bonds if interest is paid semi-annually.
C. Explain the difference in the market value determined in parts A and B.

Question

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The Answer of Chinchilla Climbers recently issued bonds with a face value of $12,000,000 and a coupon rate of 6% for 15 years. The market rate of interest is 4%.
A. Compute the market value of the bonds if interest is paid annually.
B. Computer the market value of the bonds if interest is paid semi-annually.
C. Explain the difference in the market value determined in parts A and B.

Chinchilla Climbers Recently Issued Bonds with a Face Value of $12,000,000