1a.) Suppose your credit card issuer states that it charges a 14.295% nominal annual rate, but you must make monthly payments, which amounts to monthly compounding. What is the effective annual rate?

15.27%

16.08%

16.88%

17.72%

18.61%

b. Suppose the U.S. Treasury offers to sell you a bond for $3,436.84. No payments will be made until the bond matures 10 years from now, at which time it will be redeemed for $5,000. What interest rate would you earn if you bought this bond at the offer price?

3.82%

4.25%

4.72%

5.24%

5.77%

c. What's the future value of $1,389.15 after 5 years if the appropriate interest rate is 6%, compounded monthly?

$1,537.69

$1,618.62

$1,699.55

$1,784.53

$1,873.76