A company wishes to issues bonds with a coupon rate of 5%. The company wishes to raise 100 million dollars net of commissions (5% of total sales). Each bond has a face value of $1,000 and matures in 10 years. Interest is to be paid semi-annually. Using the following conditions, please determine how many bonds the company has to sell in order to raise the necessary capital:

Question

A company wishes to issues bonds with a coupon rate of 5%.  The company wishes to raise 100 million dollars net of commissions (5% of total sales).  Each bond has a face value of $1,000 and matures in 10 years.  Interest is to be paid semi-annually.  Using the following conditions, please determine how many bonds the company has to sell in order to raise the necessary capital: