What is the $($effective$)$ interest rate in each of the

following cases.

Bought a bond with a face value of $$10,000,$ held it

for six months and received a coupon payment of

$$220$ :

$\%$

Deposited $$5,000$ at a bank for one year and

received $$55$ as interest:

$\%.$

Borrowed $885,000,000$ on July $1,2024$ and repaid

$1,000,000,000$ on July $1,2028$ :

$\%.$

All answers are to be rounded to three decimal

places.Choose all that are not appropriate statements regarding financing options for firms.

$6$

$1.$

In a bankruptcy, if there is any money left after paying off all creditors, the money is distributed to shareholders.

$2.$

Money raised through share issues is cost$-$free.

$3.$

Debt is a form of liability that has a variable rate of return.

$4.$

Cost of funds raised through a bond issue is lower than the cost of funds raised through a share issue.

$5.$

Companies must always pay dividends to reward shareholders.