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Wholesome Corporation issued bonds with a face value of $200,000 with a 4 percent stated rate of interest on January 1. The effective rate of
Wholesome Corporation issued bonds with a face value of $200,000 with a 4 percent stated rate of interest on January 1. The effective rate of interest on that date was 6 percent and interest is paid annually on December 31. The bonds mature ten years from now. What amount would bondholders be willing to pay Wholesome Corporation on January 1 for the bonds? 1) $200,000 2) $166,465 3) $170,560 4) $280,000
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