If the Market Rate of Interest Is

Multiple Choice

If the market rate of interest is

A) less than the stated rate, interest expense will be equal to interest paid.
B) greater than the stated rate, interest expense will be equal to interest paid.
C) less than the stated rate, interest expense will be less than interest paid.
D) equal to the stated rate, interest expense will be less than interest paid.
E) less than the stated rate, interest expense will be greater than interest paid.