White & Decker Corporations 2016 financial statements included the following information in the long-term debt disclosure note: ($ in millions) 2016 Zero-coupon subordinated debentures, due 2031: $346 The disclosure note stated the debenture bonds were issued late in 2011 and have a maturity value of $540 million. The maturity value indicates the amount that White & Decker will pay bondholders in 2031. Each individual bond has a maturity value (face amount) of $1,040. Zero-coupon bonds pay no cash interest during the term to maturity. The company is accreting (gradually increasing) the issue price to maturity value using the bonds' effective interest rate computed on an annual basis. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Determine the effective interest rate on the bonds. (Round your answer to 1 decimal place.) 2. Determine the issue price in late 2011 of a single, $1,040 maturity-value bond. (Round your final answer to 2 decimal places.)