Question 1 [10 marks] A company decides to raise funds to purchase new machinery by issuing $2,500,000 worth of 20-year bonds with semi-annual coupons at j2 = = 8%. These bonds are redeemable at 112. At the time of issue, interest rates in the marketplace (i.e. expected yield rates) were j2 = 9.5%. a. How much money did the company raise with the bond issue? That is, determine the purchase price of the entire bond issue. b. Suppose that the bonds are issued with a face value of $1,000. If an investor spends $60,216.04 on purchasing these bonds, how many $1,000 bonds did he purchase? c. A sinking fund accumulating interest at a rate of j4 = 6% is established in order to redeem the bonds at the end of 20 years. Determine the semi-annual expense of the debt.