Time valueAn Iowa state savings bond can be converted to $1,000 at maturity 23 years from purchase. If the state bonds are to be competitive with U.S. savings bonds, which pay 4% annual interest(compounded annually), at what price must the state sell itsbonds? Assume no cash payments on savings bonds prior to redemption. Ignore taxes.

The state must sell its bonds for $?

(Round to the nearestcent.)