On November 1,2012,FastCare Sold $5,000,000 of Three-Year Bonds for $4,750,325

question 37

Multiple Choice

On November 1,2012,FastCare sold $5,000,000 of three-year bonds for $4,750,325. From the proceeds,the company paid accounting fees of 50,000.Interest of 5% is payable annually.What is the effective rate of interest to 2 decimal places?

• A)7.30%
• B)5.00%
• C)4.69%
• D)3.63%

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Definitions:

Auditory Stimulation

The process of exciting the auditory system through the use of sound, which can influence various psychological and physiological responses.

Time Lag

The delay or period between the initiation of an action or process and its effect or outcome.

Accurately

With precision and correctness, without errors or distortions.

Detecting

The process of discovering or identifying the presence of something, especially with the assistance of specialized techniques or equipment.