Answered: What does the statement “interest rate…

What does the statement “interest rate 10%” signify? a The rate is effective per year. b The rate is nominal per year. c The rate is nominal per quarter. d The rate is effective per quarter.

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter19: The Basic Tools Of Finance

Section: Chapter Questions

Problem 1CQQ

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Question

What does the statement “interest rate 10%” signify?

	a	The rate is effective per year.
	b	The rate is nominal per year.
	c	The rate is nominal per quarter.
	d	The rate is effective per quarter.

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