On December 31, 2018, University Theatres issued $500,000 face value of bonds. The stated rate is 8%, and interest is paid semiannually on June 30 and December 31. The bonds mature in 15 years.
Required:
a. Assuming the market rate of interest is 6%, calculate at what price the bonds are issued.
B. Assuming the market rate of interest is 10%, calculate at what price the bonds are issued.