Final answer:
The face value of the bonds issued by Wildhorse Inc. is $928,000. This is the principal amount of the bond and does not change with market interest rates.
Step-by-step explanation:
The face value of the bond is $928,000. This figure is directly given in the question and represents the principal amount of the bonds issued by Wildhorse Inc. The interest rate mentioned (3%) is the coupon rate, which is the interest rate paid by bond issuers on the bond's face value. In this case, because the market interest rate at the time of the bond's issuance is 4%, higher than the coupon rate, the bond would likely have been sold at a discount, meaning the price paid for the bond was less than its face value. However, the question specifically asks for the face value, not the issue price.
It is important to note that changes in market interest rates affect the price at which bonds sell but not their face value. If the market interest rate is higher than the coupon rate, like in this scenario, the bond will sell for less than its face value (at a discount). Similarly, if the market interest rate is lower, a bond would sell at a premium, or more than its face value. But these fluctuations do not change the bond's stated face value, which in this case remains $928,000.