Hudson Corp. sells $300,000 of bonds to private investors. The bonds have an 7% coupon rate...
Hudson Corp. sells $300,000 of bonds to private investors. The
bonds have an 7% coupon rate and interest is paid semiannually. The
bonds were sold to yield 10%.
What periodic interest payment does Hudson make to its
investors?
Select one:
A. $18,000
B. $20,000
C. $ 9,000
D. $10,500
E. None of the above
Homework Answers
Solution:
Periodic interest payment on bond = $300,000*7%*6/12 = $10,500
Hence option D is correct.
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