As the Manager of Christiana Mall Jewelry, you want to sell on credit, giving customers six months in which to pay. However, you will have to secure a bank loan so that you can provide financing to your customers. The bank will charge an APR of 6% that will be compounded quarterly. You want to quote an APR to your customers based on the effective semi-annual rate that will exactly cover your financing costs.

A. What is this effective semi-annual rate?

B. What is the APR you should quote to your customers?

C. What is this effective annual rate (APY)?

D. Is this different from the effective annual rate you are paying to the bank?