Answered step by step
Verified Expert Solution
Question
1 Approved Answer
A bank quotes an interest rate of 10% pa with semi-annual compounding. Note that another way of stating this rate is that it is an
A bank quotes an interest rate of 10% pa with semi-annual compounding. Note that another way of stating this rate is that it is an annual percentage rate (APR) compounding every semi-annual. Which of the following statements about this rate is NOT correct? All percentages are given to 5 decimal places. a. Continuously compounded semi-annual rate is 4.87902% per quarter. b. The annual percentage rate (APR) compounding every quarter is 8.79902%. C. Effective quarterly rate is 2.46951% per month. d. Continuously compounded annual rate is 9.75803% per half year. e. Effective quarterly rate is 5.00000% per semi-annual
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started