Interest: Interest is the amount of interest paid on the issue price of the notes by the issuer at stated dates at stated rate of interest. To explain: The reason why the annual interest rate is different from the annual effective rate or yield.

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Chapter 6, Problem 6.3Q

To determine

Interest:

Interest is the amount of interest paid on the issue price of the notes by the issuer at stated dates at stated rate of interest.

To explain: The reason why the annual interest rate is different from the annual effective rate or yield.

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