Inc. is considering a plan to raise $40,000,000 by selling bonds. If the bonds have a $1,000 par value, mature in 10 years, pay semi-annually, have a coupon rate of 5.00% and a yield-to-maturity of 4.50%, then Dr. Shleifer will compute that BAX must sell _______ bonds.

1) 31,266

2)33,346

3) 35,564

4)38,465