Tomkin Library System issues $5 million in bonds on January 1, 2021 that pay interest semi-annually on June 30 and December 31. A portion of the bond amortization schedule appears below:DateCash PaidInterest ExpenseDecrease in Carrying ValueCarrying Value01/01/2021         $5,500,000 06/30/2021$250,000 $220,000 $30,000  5,470,000 12/31/2021 250,000  218,800  31,200  5,438,800 What is the market annual interest rate?

A. 4%.
B. 10%.
C. 8%.
D. 5%.


Answer: C

Business

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