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For the given bond, whose interest rate is provided, find the semiannual interest payment and the total interest earned over the life of the bond:$80,000 FI National Corporation 11-year bond at 4.5%.a. $3600; $39,600b. $160; $35,200c. $180,000; $3,960,000d. $1800; $39,600

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ahmedgodtrust

Answer:

Semi-annual interest payment

= 4.5% x $80,000

         2

= $1,800

Total interest earned over the life of the bond

= 4.5% x $80,000 x 11 years

= $39,600

The correct answer is D

Explanation:

The semi-annual interest payment is calculated as interest rate multiplied by the par value of the bond divided by 2.

The total interest earned over the life of the bond is calculated as interest rate multiplied by the par value multiplied by the maturity of the bond.