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On January 1, 2014, Broker Corp. issued $3,800,000 par value 9%, 9 year bonds which pay interest each December 31. If the market rate of
On January 1, 2014, Broker Corp. issued $3,800,000 par value 9%, 9 year bonds which pay interest each December 31. If the market rate of interest was 11%, what was the issue price of the bonds? (The present value factor for $1 in 9 periods at 9% is 0.4604 and at 11% is 0.3909. The present value of an annuity of $1 factor for 9 periods at 9% is 5.9952 and at 11% is 5.5370.) Which is correct: $3,379,074. $4,255,639. $3,800,000. $3,643,296.
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