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A life insurance company pays investors 4% compounded annually on its five-year GICs. For you to be indifferent as to which compounding option you choose,
- A life insurance company pays investors 4% compounded annually on its five-year GICs. For you to be indifferent as to which compounding option you choose, what would the nominal rates have to be on GICs with quarterly compounding? (Total: 8 marks)
Interim calculations should be to 5 decimal places; final answer to the nearest .01%
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Financial Accounting A Global Perspective
Authors: Robert Libby, Patricia Libby, Daniel G Short
5th Edition
0071107746, 978-0071107747
