Discount-Mart issued ten thousand $1,000 bonds on January 1, 2021. The bonds have a 10-year term and pay interest semiannually. This is the partial bond amortization schedule for the bonds.

Payment	Cash			Effective Interest			Decrease in Balance			Outstanding Balance
											8,640,967
1		300,000			345,639			45,639			8,686,606
2		300,000			347,464			47,464			8,734,070
3		300,000			349,363			49,363			8,783,433
4		300,000

What is the effective annual rate of interest on the bonds?

Multiple Choice

3%.

6%.

4%.

8%.