If the Deer Valley Ski Association borrows \(\$ 1,000,000\) by issuing, at par, 20-year, 10percent bonds with semiannual coupons, the total interest expense over the life of the issue is \(\$ 2,000,000(=20 \times 0.10 \times \$ 1,000,000)\). If Deer Valley undertakes a 20 -year mortgage or note with an implicit borrowing rate of 10 percent, the annual payments are \(\$ 1,000,000 / 8.51356=\$ 117,460\). (See Table 4 at the end of the book, 20-period row, 10 -percent column.) The total mortgage payments are \(\$ 2,349,200(=20 \times\) \(\$ 117,460\) ), and the total interest expense over the life of the note or mortgage is \(\$ 1,349,200\) ( \(=\$ 2,349,200-\$ 1,000,000\) ).

Why are the amounts of interest expense different for these two types of borrowing for the same length of time at identical interest rates?