Problem 1: Requirement 2. It the market interest rate is 9% when Marlin Corp iss

Question

Problem 1: Requirement 2. It the market interest rate is 9% when Marlin Corp issues its bonds, will the bonds be priced at par, at a premium, or at a discount Explain. The 8% bonds issued when the market interest rate is 9% will be priced at . They are in this market so investors will pay to acquire them. . 1st box options: A premium, A discount, par (maturity) value . 2nd box options: Attractive, Unattractive . 3rd box options: Less than maturity value, maturity value, more than maturity value Problem 2: Paid the six-month, 6% note at maturity.

Explanation / Answer

1st Box... At discount

2nd box - Unattractive

3rd box:- Less than the maturity value

As the interest rate is less than the prevailing market rate, the bond will be at discount and the investors will pay less.

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