Time value An Iowa state savings bond can be converted to $100 at maturity 6 years
from purchase. If the state bonds are to be competitive with U.S. savings bonds, which
pay 8% annual interest (compounded annually), at what price must the state sell its
bonds? Assume no cash payments on savings bonds prior to redemption
By Excel function
The price at which the state can sell its bond is at $63.02.