A. Find the effective rate equivalent to: 1. 8% compounded quarterly 2. 12% compounded monthly 3. 11% compounded semi-annually B. Find the nominal rate compounded quarterly is equivalent to an effective rate of 4. 8% 5. 10%
A. Find the effective rate equivalent to: 1. 8% compounded quarterly 2. 12% compounded monthly 3. 11% compounded semi-annually B. Find the nominal rate compounded quarterly is equivalent to an effective rate of 4. 8% 5. 10%
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:* 2.1 49 LM51% 10:42 PM
ACTIVITY #8
Name:
Year/Set:
Subject:
Score:
Direction: Read and understand this module. Provide what is being asked. Write your answer on
the space provided and use long bond paper (Hand Written) for problem solving
A. Find the effective rate equivalent to:
1. 8% compounded quarterly
2. 12% compounded monthly
3. 11% compounded semi-annually
B. Find the nominal rate compounded quarterly is equivalent to an effective rate of
4. 8%
5. 10%
C. What nominal rate compounded semi-annually is equivalent to:
6. j= 9%, m = 1
7. j= 8%, m = 4
D. Solve the following problems:
8. Which is better, to invest money at 8% m = 4 or at 8 2%, m = 12?
9. Which is better, to deposit your money in a bank which credits an account at 6%
compounded quarterly or at 6% compounded monthly?
10. If my time deposit earns 7% compounded quarterly will I change it to 7 2% effective?
End of gth week
--Nothing Follows-
BM 211 - Mathematics of Investment
Page 4 of 4
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