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Carla Vista Co. is about to issue $311,700 of 7-year bonds paying an 12% interest rate, with interest payable semiannually. T

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Answer #1
Amount PV factor 4% Present value
Semi-annual interest 18702 10.56312 197551
Principal 311700 0.57748 180001
Total 377552
Carla Vista Can expect to receive $377552
Workings:
Semi-annual interest 18702 =311700*12%/2
PV factor 4%
Semi-annual interest 10.56312 =(1-(1.04)^-14)/0.04
Principal 0.57748 =1/1.04^14
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