Discount-Mart Issues $10 Million in Bonds on January 1,2018 A)3%
B)4

Discount-Mart issues $10 million in bonds on January 1,2018.The bonds have a ten-year term and pay interest semiannually on June 30 and December 31 each year.Below is a partial bond amortization schedule for the bonds: What is the market annual rate of interest on the bonds? (Hint: Be sure to provide the annual rate rather than the six month rate. )
$$\begin{array} { | c | r | r | r | r | } \hline \text { Date } & \begin{array} { r } \text { Cash } \\\text { Paid }\end{array} & \begin{array} { r } \text { Interest } \\\text { Expense }\end{array} & \begin{array} { r } \text { Increase } \\in\\\text { Carrying } \\\text { Value }\end{array} & \begin{array} { r } \text { Carrying } \\\text { Value }\end{array} \\\hline 1 / 1 / 2018 & & & & \$ 8,640,967 \\\hline 6 / 30/12018 & \$ 300,000 & \$ 345,639 & \$ 45,639 & 8,686,606 \\\hline 12 / 31 / 2018 & 300,000 & 347,464 & 47,464 & 8,734,070 \\\hline 6 / 30/2019 & 300,000 & 349,363 & 49,363 & 8,783,433 \\\hline 12 / 31 / 2019 & 300,000 & 351,337 & 51,337 & 8,834,770 \\\hline\end{array}$$

A) 3%.
B) 4%.
C) 6%.
D) 8%.