As a result of the interest rate being 8% and the coupon being 7%, these bonds will sell at a price less than $500,000.
Why would the bonds sell less than $500,000?
When a bond's coupon rate is less than the market rate of interest, it is referred to as a discount bond.
This means that the bond will be sold at a price that is less than its face value amount. In this case the market rate is higher than the coupon rate so the bond will sell for less than $500,000.
Find out more on discount bonds at https://brainly.com/question/23265123.
