c15 q8

Selling bonds.Rawlings needs to raise $36,600,000 for its new manufacturing plant in Jamaica. Berkman Investment Bank will sell the bond for a commission of 2.1%. The market yield is currently 7.6% on twenty-year zero-coupon bonds. If Rawlings wants to issue a zero-coupon bond, how many bonds will it need to sell to raise the $36,600,000? Assume that the bond is semiannual and issued at a par value of $1,000.

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Part 1

Selling bonds.Rawlings needs to raise

$36,600,000

for its new manufacturing plant in Jamaica. Berkman Investment Bank will sell the bond for a commission of

2.1%.

The market yield is currently

7.6%

on twenty-year zero-coupon bonds. If Rawlings wants to issue a zero-coupon bond, how many bonds will it need to sell to raise the $36,600,000?Assume that the bond is semiannual and issued at a par value of $1,000.

How many bonds will Rawlings need to sell to raise the $36,600,000?

(Round to the nearest whole number.)