Final answer:
To calculate the APR of the bond, use the simple interest formula with the given face value, purchase price, and years until maturity. The APR is found to be 6.75% for the eight-year bond with a $5400 purchase price and a $8316 face value.
Step-by-step explanation:
To find the Annual Percentage Rate (APR) of the bond, we can use the formula of the simple interest, since the problem does not specify any compounding during the period. The formula to calculate the APR is APR = (FV - PV) / (PV * n), where FV is the face value of the bond at maturity, PV is the purchase price of the bond, and n is the number of years until maturity.
In this scenario, we have a face value (FV) of $8316, a purchase price (PV) of $5400, and the bond matures in 8 years (n). Plugging these values into the formula, we get APR = ($8316 - $5400) / ($5400 * 8).
Calculating the above expression, APR = $2916 / ($5400 * 8) = $2916 / $43200, which simplifies to APR = 6.75%. Therefore, the APR of the bond is 6.75%.