Step 1
Given;
[tex]\begin{gathered} Face\text{ }value\text{ bond = \$7892 } \\ Rate\text{ of interest=8.62\%=0.0862} \\ Bond\text{ will mature in 13 years} \end{gathered}[/tex]If the interest is semiannual, the rate of interest will reduce to half.
[tex]\begin{gathered} So\text{ the new interest rate will be} \\ \frac{8.62}{2}=4.31 \\ \end{gathered}[/tex]Step 2
Find how much interest will he receive semiannually?
[tex]Simple\text{ interest=}\frac{Principal\times Rate\times Time}{100}[/tex][tex]\begin{gathered} S.I=\frac{7892\times4.31\times1}{100} \\ S.I=\text{ \$}340.1452 \\ S.I\approx\text{ \$340.15} \end{gathered}[/tex]Hence, the interest he will recieve semina
