You don't have to give me the answer if you don't want, I would really appreciate knowing how to figure this problem out.

Doran Co. issued $40 million face amount of 11% bonds when market interest rates were 11.14% for bonds of similar risk and other characteristics.

A. How much interest will be paid annually on these bonds?:p

The annual interest is the face value times the coupon rate: $40 million times 11%.

The market interest rate affects the price of the bond, but not the annual interest.

For this question, were the bonds issued at a premium or discount?
-And-
Will the annual interest expense on these bonds be more than, equal to, or less than the amount of interest paid each year? Why?

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