A major farming company is planning to purchase new tractors. It wants to borrow $650 million by issuing bonds. The bonds are for a 12-year period with simple interest computed quarterly at a rate of 10 percent per year. Interest is to be paid each quarter to bondholders. How much will the airline have to pay it. quarterly interest? How much interest will it pay in the 12-year period?
Question # 2
A woman has purchased $752,000 worth of corporate bonds. The bonds expire in 25 years, and simple interest in computed semiannually at a rate of 16 percent per year. Interest checks are mailed to bondholders every 6 months. Determine the interest the woman can expect to earn every yearly. How much interest can she expect over the 25-year period?
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