On October 31, 2011, Simeon Builders borrowed $16 million cash and issued a 7-month, noninterest-bearing note. The loan was made by Star Finance Co. whose stated discount rate is 8%. Sky's effective interest rate on this loan is:

A. More than the stated discount rate of 8%.

B. Less than the stated discount rate of 8%.

C. Equal to the stated discount rate of 8%.

D. Unrelated to the stated discount rate of 8%