Haste Enterprises issues 20-year, $1,000,000 bonds that pay semiannual interest of $40,000. If the effective annual rate of interest is 10%, what is the issue price of the bonds? Some relevant and irrelevant present value factors: * PV of ordinary annuity of $1: n = 20; i = 10% is 8.51356 **PV of $1: n = 20; i = 10% is 0.14864 * PV of ordinary annuity of $1: n = 40; i = 5% is 17.5909 **PV of $1: n = 40; i = 5% is 0.14205

Multiple Choice

• $828,000.

• $893,000.

• $1,000,000.

• $1,686,000.