Nominal rate choices = (4.13%, 8.65%, 11.00%,

11.25%)

Period Rate choices= (2.27%, 2.75%, 4.50%, 11.00%)

Effective Annual Rate Choices= (2.27%, 4.50%, 11.46%, 11.85%)

4th blank choices= (10.56%, 10.69%, 10.38%, 10.50%)

7. Non annual compounding period The number of compounding periods in one year is called compounding frequency. The compounding frequency affects both the present and future values of cash flows. An investor can invest money with a particular bank and earn a stated interest rate of 11.00%; however, interest will be compounded quarterly. What are the nominal (or stated), periodic, and effective interest rates for this investment opportunity? Interest Rates Nominal rate Periodic rate Effective annual rate Manuel needs a loan and is speaking to several lending agencies about their interest rates and loan terms. He particularly likes his local bank because he is being offered a nominal rate of 10.00%. However since the bank is compounding its interest quarterly, the loan will impose an effective interest rate of on his loan. Another bank is also offering favorable terms, so Manuel decides to take a loan of $16.000 from this bank. He signs the loan contract at 13.00% compounded daily for three months. Based on 365-day vean what is the total amount that Manuel Owes the bank at the end of the loan's term? (Hint: To calculate the number of days. divide the number of months by 12 and multiply by 365.) 516.520.20 517.10.33 O $17,354.61 $17.519.89