Question
a)What is the future value of $2,750 after six years under 5.6% semiannual compounding b) What is the effective annual rate for 5.6% interest with
a)What is the future value of $2,750 after six years under 5.6% semiannual compounding
b) What is the effective annual rate for 5.6% interest with semiannual compounding? Be sure to show your EAR answer to 2 decimals, that is xx.xx%
c) What is the future value of $2,750 after six years under 5.6% quarterly compounding?
d) What is the effective annual rate (EAR) for 5.6% interest with quarterly compounding?
e)Explain how the effective annual rate changes based on the number of compounding periods per year.
f) What is the future value of $2,750 after six years under 5.6% daily compounding? Assume 365 days in the year
g) What is the effective annual rate for 5.6% (APR) interest with daily compounding?
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Fundamentals Of Corporate Finance
Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford
5th Edition
9780135811603
