On January 1, 2024, Morton Sales Company issued zero-coupon bonds with a face value of $5.5 million for cash. The bonds mature in
6 years and were issued at a price of $3,877,280.
Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)
Required:
What was the annual effective interest rate in the market when the bonds were issued?
Annual effective interest rate
%