Marwick Corporation Issues 8%,5-Year Bonds with a Par Value of $1,000,000

Marwick Corporation issues 8%,5-year bonds with a par value of $1,000,000 and semiannual interest payments.On the issue date,the annual market rate for these bonds is 6%.What is the bond's issue (selling) price,assuming the following Present Value factors:
$\begin{array} { r l c c } &&\text { Present Value of an}\\ \mathrm {n } = & \mathrm { i } = & \text { Annuity } & \text { Present value of } \$ 1 \\5 & 8 \% & 3.9927 & 0.6806 \\10 & 4 \% & 8.1109 & 0.6756 \\5 & 6 \% & 4.2124 & 0.7473 \\10 & 3 \% & 8.5302 & 0.7441\end{array}$

A) $1,000,000
B) $789,244
C) $1,341,208
D) $1,085,308
E) $658,792

Correct Answer:

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