After reviewing the compounding model your kindergartener has a follow-up question about effective annual rates. She figures with more frequent compounding the effective annual rate cannot be 3% for all the compounding options. Calculate the effective annual rate for each of the compounding options using a function. Round three decimal places. Annual at 3% Semi-annual at 3.022% Quarterly at 3.034% Monthly at 3.042%

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
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After reviewing the compounding model your kindergartener has a follow-up question about effective annual rates. She figures with more frequent compounding the effective annual rate cannot be 3% for all the compounding options. Calculate the effective annual rate for each of the compounding options using a function. Round three decimal places.

Annual at 3%

Semi-annual at 3.022%

Quarterly at 3.034%

Monthly at 3.042%

 

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