Find the equivalent interest rates for the following: a. Nominal interest rate compounded quarterly that is equivalent to 5% compounded semi-annually. % Round to two decimal places b. Nominal interest rate compounded monthly that is equivalent to 3.8% compounded quarterly.

Q: Find the effective rate of  interest if the nominal rate is 12 % compounded bi - monhtly.

A: Annual Nominal interest rate = 0.12 Number of compounding in a year (n) = 6 (i.e. 12 months / 2)  Bi…

Q: nk quotes you an interest rate of 6.6% per annum with quarterly compounding. What is the equivalent…

A: In compounding there is interest on interest including the interest on the principal amount also due…

Q: Which of the following compounding rates is equivalent to an effective interest rate of 2.75% p.a.…

A: The effective interest rate also referred to as the annual equivalent rate or the effective rate is…

Q: The nominal annual rate of interest is 7%, compounded monthly. Compute the real rate of interest if…

A: Nominal rate of interest is the given rate. This rate does not consider the impact of the…

Q: What is the difference between computing interest at a nominal annual rate of interest and computing…

A: The interest rate which is taken into account before considering inflation is called the nominal…

Q: If the annual interest rate is 7%, what is the monthly interest rate that would be used as the "r"…

A: Time value of money (TVM) refers to the method used to measure the amount of money at different…

Q: What nominal rate of interest compounded semi-annually can be used instead of 10 % comp. monthly…

A: We need to determine the effective annual rate that would equal the 2 compounding methods. The…

Q: Determine the nominal rate of interest compounded quarterly which is equivalent to 6.3% compounded…

A: The nominal interest rate refers to the periodic interest rate multiplied by the number of periods…

Q: Find the annual percentage yield for an investment at the following rates. (Round your answers to…

A: Annual percentage yield = [(1 + i/n)^n] - 1 where, i = nominal interest rate n = compounding period…

Q: What is the equivalent rate of interest (in %) for a discount rate of 7.9% for 77 days? Round your…

A: Interest rate is referred as the percentage of the principal charged through the lender regarding…

Q: The lender charges the borrower 1.8% per quarter. Find the equivalent nominal rate of interest.…

A: The nominal rate of the loan is stated in annualized terms without considering the effect of…

Q: For the following investment, find the total number of compounding periods and the interest rate per…

A: Compounding periods = Years * Number of time compounded Compounding periods =8*4 Compounding periods…

Q: An amount of $105,650 was accumulated after 10 years of payments of $2,024.15 at the beginning of…

A: An annuity is a series of payments provided in exchange for a lump sum payment. It is widely used in…

Q: Determine the effective rate of interest of the following nominal rates. a. nominal rates…

A: Effective interest rate formula  When Compounded annually and quarterly (1+r/n) n - 1  r= nominal…

Q: Calculate the nominal interest p.a. compounded daily that is equivalent to 3.7% p.a. compounded…

A: The equivalent annual interest rate is calculated by

Q: Compounding Effective Period APR per Year Periodic Rate Annual Rate Semiannual 10% 2 ? ? ? ?…

A: Given:

Q: Assume an effective compound interest rate i = In each case, enter your answer as a percentage. a)…

A: The effective rate of interest refers to the interset that should be paid over investment or the…

Q: If you know the nominal interest rate 3% Per Quarter A) Find the Nominal interest rate. B) Find the…

A: Here, Nominal Interest Rate is 3% per Quarter

Q: What is the nominal rate of interest compounded semi annually which is equal to 8.81% compounded…

A: Interest rate (APR) = 8.81% Compounding per year (M) = 4

Q: Find the nominal annual rate of interest compounded semi-annually that is equivalent to 5.5%…

A: Compounding refers to the effect of the frequency of receiving interest on the total value of the…

Q: You currently earn 8% per annum with quarterly compounding. What is the equivalent interest rate…

A: To convert an interest rate with quarterly compounding to an equivalent rate with continuous…

Q: An interest rate of 2% per quarter, compounded continuously, is closest to an effection semi annual…

A: Quarterly Interest Rate = r = 2%

Q: The nominal interest rate compounded quarterly, ; (4) is 6%. Let i be the annual effective interest…

A: The cost of borrowing money or the return on investment represented as a percentage of the principal…

Q: Find the APY corresponding to the following nominal rate. 9% compounded quarterly The APY is %.…

A: APY stands for annual percentage yield. Formula for APY= (1+rn)n -1 where r= rate n= number of…

Q: d the equivalent interest rates to the given nominal interest rates. a. Nominal interest rate…

A: Nominal interest rate is the simple interest without considering the impact of compounding on the…

Q: Compute the periodic interest rate, as a decimal, given a nominal interest rate and compounding…

A: Interest: Interest is the amount of interest paid on the issue price of the notes by the issuer at…

Q: If the annual interest rate is 12.9% and the dollar amount compounds daily, you would ( a. multiply…

A: Data given: Annual Interest rate=12.9% compounded daily. (Annual means N=1 year)

Q: The (blank) interest rate is referred to as APR and the (blank) interest rate is the true rate…

A: Effective rate ( EAR) FORMULA: EAR =1+APRMM-1M = frequency of compounding

Q: Find the effective interest rate per quarter at a nominal rate of 8% compounded. a. weekly b. daily

A: Effective Interest Rate is known as the real return that you earned on the your saving account or on…

Q: To be equivalent to 10.6% compounded quarterly, what must be the nominal rate with: (Do not round…

A: The nominal return refers to the return quoted to the investor when they invest. It does not…

Q: What is the effective interest rate corresponding to a nominal annual rate of. (Round your…

A: Whenever the impacts of compounding over time are considered, the effective annual interest rate is…

Q: ) An interest rate of 5% compounded quarterly is equivalent to what rate compounded monthly?

A: Using excel Effective and Nominal Rate function

Q: Find the equivalent interest rates to the given nominal interest rates. a. Nominal interest rate…

A: The nominal interest rate refers to the return that the investment earns if the effects of…

Q: What is the periodic interest rate for an APR of 23% with daily compounding? Enter your answer…

A: Compound = n = Daily = 365Interest Rate = r = 23%

Q: 2. Find the effective rate of interest per annum corresponding to the nominal rate of interest 8%…

A: Because you have postged mutiple questions, we will answer the first question only. For the…

Q: Find the nominal annual rate of interest compounded quarterly that is equivalent to 4.8% compounded…

A: Nominal Annual Interest Rate: The nominal interest rate is calculated by multiplying by the number…

Q: Given an Annual Percentage Rate (APR) of 0.072 with quarterly compounding, the equivalent interest…

A: When the lender lends a loan to the borrower, he charges a rate of interest on the borrowed amount.…

Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.