What nominal interest rate per year is equivalent to an effective 18% per year compounded semiannually? Select one: O a. 18.81 O b. 24.33 O c. 21.81 O d. 17.26 O e. 19.75
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- Define the stated (quoted) or nominal rate INOM as well as the periodic rate IPER. Will the future value be larger or smaller if we compound an initial amount more often than annually—for example, every 6 months, or semiannually—holding the stated interest rate constant? Why? What is the future value of $100 after 5 years under 12% annual compounding? Semiannual compounding? Quarterly compounding? Monthly compounding? Daily compounding? What is the effective annual rate (EAR or EFF%)? What is the EFF% for a nominal rate of 12%, compounded semiannually? Compounded quarterly? Compounded monthly? Compounded daily?Which one of the following represents the highest effective interest rate per year? Select one: O a. 10.5% per year, compounded semiannually Ob. 10.4% per year, compounded daily O c. 10% per year, compounded quarterly O d. 10% per year, compounded monthly O e. 9.8% per year, compounded continuouslyDetermine the nominal interest rate compounded continuously corresponding to an effective interest rate of 12% per year. Select one: a. 11.33% b. 11.75% c. 10.68% d. 10.25%
- What is the effective annual interest rate if the nominal annual interest rate is 24% per year compounded monthly? a. 2.00% b. 24.00% c. 26.82% d.27.12%A certain nominal annual interest rate has an effective rate of 19.722% when compounded continuously. What is its effective rate if compounded bi-monthly? A. 19.87% B. 18.45% C 18% D. 19.41%Considering an interest rate i=14% per year, what is the compound interest rate equivalent to the following periods. a) 45 days b)72 days
- An interest rate of 2% per quarter, compounded continuously, is closest to an effection semi annual rate of: a)2.02% per semiannual period b). 4.00% per semiannual period c). 4.08% per semiannual period d). 2.00% per semiannual period e).5.0% per semiannual periodIf the nominal or headline rate of interest is 24%, what is the effective annual ratei. semi-annuallyii. quarterly Answer both.You currently earn 8% per annum with quarterly compounding. What is the equivalent interest rate with continuous compounding? (enter percentage in decimal form to four decimal places, i.e. eleven and a half percent would be entered as 0.1150) (Required precision: 0.0001 +/- 0.0001)
- An interest rate obtained by dividing the nominal rate per year by the number of compounding periods in that year isa. A nominal interest rateb. An effective interest ratec. An effective interest rate only if the compounding period is monthlyd. Either (b) or (c)A fixed income instrument with a stated annual interest rate of 18% and offers monthly compounding has an effective annual rate (EAR) closest to:A. 18.00%.B. 19.56%. C. 20.12% Use excelA rate of 2% per quarter compounded quarterly is closest to what annual compounded interest rate? (a) 2.00% (b) 8.00% (c) 8.24% (d) 24.00%