Bonds with a Face Value of $200,000 Were Sold at an Effective

Multiple Choice

Bonds with a face value of $200,000 were sold at an effective interest rate of 8% to yield cash proceeds in excess of $200,000.It is apparent that the bonds had a:

A) stated interest rate less than 8%.
B) stated interest rate greater than 8%.
C) effective interest rate less than 8%.
D) effective interest rate greater than 8%.