On January 1, 2018, frontier world issues $40.5million of 7% bonds due in 10 years with interest payable semiannually on June 30 and December 31 each year. The proceeds will be used to build a new ride that combines a roller coaster, a water ride , a dark tunnel , and the great smell of outdoor barbecue all in one ride.

000 points Required: 1a. If the market rate is 6%, calculate the issue price. (FV of $1. place.) Bond Characteristics Amount Face amount Interest payment Market interest rate Periods to maturity Issue price $ 40,500,000 $1,417,500 3,0% 20 $ 40,500,000