Several years ago brant, inc., sold $880,000 in bonds to the public. annual cash interest of 8 percent ($70,400) was to be paid on this debt. the bonds were issued at a discount to yield 12 percent. at the beginning of 2013, zack corporation (a wholly owned subsidiary of brant) purchased $110,000 of these bonds on the open market for $131,000, a price based on an effective interest rate of 6 percent. the bond liability had a book value on that date of $740,000. assume brant uses the equity method to account internally for its investment in zack.

1. what is the amount of interest earned after two years on a $100 deposit paying 4 percent simple interest annually? $8.00 $4.08 $8.16 $4.00 2. what is the amount of compound interest earned after three years on a $100 deposit paying 8 percent interest annually? $24.00 $8.00 $16.64 $25.97 3. a business just took out a loan for $100,000 at 10% interest. if the business pays the loan off in three months, how much did the business pay in interest? $2,500.00 $10.00 $250.00 $10,000.00 4. what is the annual percentage yield (apy) for a deposit paying 5 percent interest with monthly compounding? 5.00% 5.12% 79.59% 0.42%