Final answer:
The stated annual interest rate on the bond is 5.00%. Therefore, the correct option is A.
Step-by-step explanation:
To determine the stated annual interest rate on the bond, we need to calculate the interest rate for the whole year based on the first interest payment of $1,875. Since the bond pays interest semi-annually and the first interest payment is $1,875, we can calculate the annual interest payment by multiplying it by 2. This gives us $1,875 * 2 = $3,750. To determine the stated annual interest rate, we divide the annual interest payment by the face value of the bond, which is $75,000. So the stated annual interest rate is $3,750 / $75,000 = 0.05, or 5%. Therefore, the correct answer is option a. 5.00%.