Assume Venture Healthcare sold $25 million in bonds that have a ten-year maturity, a 7% coupon rate with annual payments, and a $1,000 par value.

a. total interest expense for this bond issue, assuming that all bonds are held to maturity?

b. Suppose that Venture could obtain a mortgage for the same amount with a 7% interest rate with monthly payments, The loan would be amortized over the same ten year period. What would be the total cost of that debt?

c. c. Which option would be cheaper?