An investment offers $7\mathrm{.}0\%$ nominal rate of interest, compounded quarterly. Which of the following statements is CORRECT?

Group of answer choices

The periodic rate of interest is $7\mathrm{.}0\%$ and the effective rate of interest is greater than $7\mathrm{.}0\%.$

The periodic rate of interest is $3\mathrm{.}50\%$ and the effective rate of interest is $7\mathrm{.}0\%.$

The periodic rate of interest is $1\mathrm{.}75\%$ and the effective rate of interest is greater than $7\mathrm{.}0\%.$

The periodic rate of interest is $1\mathrm{.}75\%$ and the effective rate of interest is less than $7\mathrm{.}0\%.$