Alexi Co. issued $4.00 million face amount of 7%, 10-year bonds on June 1, 2019. The bonds pay interest on an annual basis on May 31 each year.

Required:
a. Assume that the market interest rates were slightly higher than 7% when the bonds were sold. Would the proceeds from the bond issue have been more than, less than, or equal to the face amount?

a. Assume that market interest rates were slightly lower than 13.2% when the bonds were sold. Would the proceeds from the bond issue have been more than, less than, or equal to the face amount?