12 pts Question 5 Boxer Corporation is issuing $600,000 of 8%, 5-year bonds when potential bond investors want a return of 10%. Interest is payable semiannually. Present Value of $1 12% Per. 1 2 3 4 5 6 7 8 9 10 1% 0990 0.980 0.971 0.961 0 951 0.942 0.933 0.923 0.914 0.905 2% 0.980 0.961 0.942 0.924 0.906 0.888 0.871 0.853 0.837 0.820 3% 0.971 0.943 0.915 0.888 0.863 0.837 0.813 0.789 0.766 0.744 0.962 0.925 0.889 0.855 0.822 0.790 0.760 0.731 0.703 0.676 5% 0.952 0.907 0.864 0.823 0.784 0.746 0.711 0.677 0.645 0.614 6% 0.943 0.890 0.840 0.792 0.747 0.705 0.665 0.627 0.592 0.558 7% 0.935 0.873 0.816 0.763 0.713 0.666 0.623 0.582 0.544 0.508 8% 0.926 0 857 0.794 0.735 0.681 0.630 0.583 0.540 0.500 0.463 9% 0.917 0.842 0.772 0.708 0.650 0.596 0.547 0.502 0.460 0.422 10% 0.909 0.826 0.751 0.683 0.621 0.564 0.513 0.467 0.424 0.386 11% 0.901 0.812 0.731 0.659 0.593 0.535 0.482 0.434 0.391 0.352 0.893 0.797 0.712 0.636 0.567 0.507 0.452 0.404 0.361 0322 Present Value of an ordinary Annuity of $1 per period Per. 1% 2% 3% 4% 5% 6% 0.990 0.980 0.971 0.962 0.952 0.943 2 1970 1.942 1.913 1.886 1.859 1.833 3 2.941 2.884 2.829 2.775 2.723 2.673 4 3.902 3.808 3.717 3.630 3.546 3.465 5 4.853 4.713 4.580 4.452 4.329 4.212 6 5.795 5.601 5.417 5 242 5.076 4.917 7 6.728 6.472 6.230 6.002 5.786 5.582 8 7.652 7.325 7.020 6.733 6.463 6.210 9 8.566 8.162 7.786 7.435 7.108 6.802 10 9.471 8.983 8.530 8.111 7.722 7.360 7% 0.935 1.808 2.624 3.387 4.100 4.767 5.389 5.971 6.515 7.024 8% 0.926 1.783 2577 3.312 3.993 4.623 5.206 5.747 6.247 6.710 9% 0.917 1.759 2.531 3.240 3.890 4.486 5.033 5.535 5.995 6.418 10% 0.909 1.736 2.487 3.170 3.791 4.355 4.868 5.335 5.759 6.145 11% 0.901 1.713 2.444 3.102 3.696 4.231 4.712 5.146 5.537 5.889 12% 0.893 1.690 2.402 3.037 3.605 4.111 4.564 4.968 5.328 5.650 Requirement: 1) Calculate the PV of the Principal. 2) Calculate the PV of Interest Payments 3) What is the selling price of the bond? 4) Did the bond sell at face value, discount, or a premium