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Quantitative Problem: Bank 1 lends funds at a nominal rate of 6% with payments to be made semiannually. Bank 2 requires payments to be made quarterly. If Bank 2 would like to charge the same effective annual rate as Bank 1, what nominal interest rate will they charge their customers? Do not round intermediate calculations. Round your answer to three decimal places.

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Calculate the nominal rate charged by Bank 2 that provides the same EAR as Bank 1 : 0.0816=(1+INOM/4)41 1.0816=(1+INOM/4)4 1.0198=1+INOM/4 (Each side of equation is raised to the 1/4 power) INOM=7.922% Alternatively, use a financial calculator as follows: Calculate the EAR charged by Bank 1 : Input data as follows: INOM=8 and P/YR=2. Solve for EFF%=8.16%