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 the market rate.
B) stated interest rate greater than the market rate.
C) effective interest rate less than the stated rate.
D) effective interest rate greater than the market rate.