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Suppose you are the President of a small country named Jolligolly. The government in Jolligolly is considering, for the first time issuing bonds to help
Suppose you are the President of a small country named Jolligolly. The government in Jolligolly is considering, for the first time issuing bonds to help fund an update to the highway system. They are planning on issuing 10,000 zero coupon bonds with maturities of 20 years. The bonds will be priced at $570 each at issuance. The face value is $1,000 and compounding is semiannually. What is the cost of these bonds to the government of Jolligolly? 1.42% 5.70% 2.83% 3.86%
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