Boston Company issues bonds with a par value of $160,000 on their stated issue date. The bonds mature in six years and pay 8% annual interest in semiannual payments. On the issue date, the annual market rate for the bonds is 6%.
Requirement 1: What is the amount of each semiannual interest payment for these bonds? answer 6,400
Requirement 2: How many semiannual interest payments will be made on these bonds over their life? answer 12
Requirement 3: answer "premium"
Use the interest rates given to determine whether the bonds are issued at
Requirement 4: Compute the price of the bonds as of their issue date.
Cash Flow Amount Table Value Present Value
Par (maturity) value $ $
Interest (annuity)
Price of bonds