Question about bonds?

The bond pays 8% interest at the issue. If interest rates go up, the price of the bond will go down in order to continue to pay the 8% at issue. For example if you buy a $1000 bond it will pay $80. If the interest rates go up to 9% the price will drop to $888.89 for the bond when traded. If the rate went down to 7%, the bond would sell for about $1142.86. To calculate current yield divide annual interest in $ by the market price. In your case, the company selling the bond recieves the $5m and pays a broker to sell it. At the end of the term, they repay the $5M to the bond holders. The interest payed to the holder is the cost of the "loan" so there is no PV or FV as there would be in a term loan.