Republic Finance offers money at 2.32% permonth compounded monthly.(a) What is the nominal interest rate?(b) What is the effective annual interest rate?(c) How many years will it take an investment totriple if interest is compounded monthly?(d) How many years will it take an investment toquadruple if the nominal rate is compoundedcontinuously?

Financial Management: Theory & Practice
16th Edition
ISBN:9781337909730
Author:Brigham
Publisher:Brigham
Chapter4: Time Value Of Money
Section: Chapter Questions
Problem 8MC: Define the stated (quoted) or nominal rate INOM as well as the periodic rate IPER. Will the future...
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Republic Finance offers money at 2.32% per
month compounded monthly.
(a) What is the nominal interest rate?
(b) What is the effective annual interest rate?
(c) How many years will it take an investment to
triple if interest is compounded monthly?
(d) How many years will it take an investment to
quadruple if the nominal rate is compounded
continuously?

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