Question
A bank term deposit offers an interest rate of 3.4% pa, payable semi-annually. Which of the following statements about the interest rate is NOT correct?
A bank term deposit offers an interest rate of 3.4% pa, payable semi-annually. Which of the following statements about the interest rate is NOT correct? All rates are given to four decimal places. Assume 12 months in a year and 365 days in a year.
a. The effective daily rate is 0.0104%per month. b. The effective annual rate is 3.4289%per annum. c. The effective 6-month rate is 1.7000% per six months. d. The APR compounding semi-annually is 3.4000% per annum.
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Economics For Investment Decision Makers
Authors: Sandeep Singh, Christopher D Piros, Jerald E Pinto
1st Edition
1118111966, 9781118111963
