Question
On January 1, 2012, the City of Raleigh issued a 20-year bond to finance improvements to the highway system. A total of $100,000,000 in bonds
On January 1, 2012, the City of Raleigh issued a 20-year bond to finance improvements to the highway system. A total of $100,000,000 in bonds with coupon and maturity rates as follows:
| December 31, 2021 | 3.5% | $10,000,000 |
| December 31, 2026 | 4.0% | $10,000,000 |
| December 31, 2027 | 4.0% | $10,000,000 |
| December 31, 2028 | 4.0% | $15,000,000 |
| December 31, 2029 | 4.0% | $15,000,000 |
| December 31, 2030 | 4.5% | $20,000,000 |
| December 31, 2031 | 4.5% | $20,000,000 |
Raleigh received $100,500,000 from the bond issue. What is the net interest cost for the bond issue?
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Public Finance An International Perspective
Authors: Joshua E. Greene
1st Edition
9814365041, 978-9814365048
