Ipswich Industries plans to issue 5-year, 6%, $500,000 bonds paying interest on an annual basis, at a $3,500 discount. Which one of the following statements is true? Select one: A. The cash paid to bondholders will be $3,500 each year. B. Ipswich's annual interest expense on the bonds will be greater than the amount of interest payments to bondholders each year. C. The effective rate of interest on the bonds is lower than 6%. D. Ipswich will receive $503,500 as the issue price.