lenders, and it is also called the annual percentage rate $($APR$).$ If the compounding periods for different securities is the use the APR for comparison. If the securities have different compounding periods, then the I must be used for comparison.

Here, $M$ is the number of compounding periods per year and $\frac{I_{\text{N}\text{O}\text{M}}}{M}$ is equal to the periodic rate $($IPER$).$ If a loan or investment uses compounding, then the nominal interest rate is also its effective annual rate. However, if compounding occurs more than once a year, EAR is INOM. 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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