Find the total number of compounding periods and the interest rate per period for the investment. Term of Investment Nominal (Annual) Rate (%) Interest Compounded Compounding Periods Rate per Period (%) 4 years 4.5 semiannually

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Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.