72 THE FISCAL PROBLEM IN MISSOURI bonds issued are usually sold either at a premium or at a discount, and only rarely at par. It follows that the true rate of interest will be affected by the amount of the premium or the discount, since in the one case more money is received than will be required for purposes of redemption, and in the other case the redemption payments will exceed the amount of money originally received. A second factor is the nominal or coupon rate of interest and the frequence of interest dates. The annual or semi-annual interest payments are a function of this rate and the par value of the obligations. While these payments are not the sole factor in determining the cost of money, under all ordinary conditions they are the most important factor. A third factor is the maturity date of the bonds, which is particularly important in cases where the bonds were sold at a considerable premium or discount. The premium or the discount depends in turn upon both the coupon rate of interest and the maturity dates. Other factors, such as callable or conversion features, need not be discussed here, as they have no particular application to the problem under consideration. The requisite information being available, it was decided to compute the cost of money or the true rate of interest on the receipts from the $60 million of state highway bonds issued during the years 1922 to 1927. The facts concerning the ten series of bonds comprising this issue are shown in Table 24. The coupon rate of interest for the first three series issued in 1922 and 1923 was 414%,. Series D and E bore a coupon rate of 4%, and the later series a rate of 4249. The coupon rate was changed in accordance with money market conditions and the desired maturity dates, and such changes as were made are not indicative of any change in Missouri’s credit position. That the three earlier series were marketed at a higher coupon rate than any of the later issues may be attributed in large part to the relatively brief period for which they were issued. Five series! amounting to $32.5 million par were sold at a premium, and the total received on account of premium was $482,732.50. The other five series? were sold at a discount, the total discount amounting to $186,691.50. The net L Series A, F, H, I, and J. 2 Series B, C, D, E, and G.