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Comparing Interest Rates Suppose you can borrow money at 10.71% per year (APR) compounded semiannually or 11.97% per year (APR) compounded monthly. a. Calculate the

Comparing Interest Rates

Suppose you can borrow money at 10.71% per year (APR) compounded semiannually or 11.97% per year (APR) compounded monthly.

a. Calculate the Effective Annual Rate. (Do not round intermediate calculations. Round your answers to 2 decimal places.)

Effective Annual Rate
10.71% %
11.97% %

b.

Which is the better deal?
APR compounded monthly.
APR compounded semiannually.

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