Q1:

A bank offers personal loans at 12.4%p.a compounding monthly. The effective annual rate of interest (EAR) is ( to the nearest two decimal places):

Select one:

a. 1.03%

b. 12.99%

c. 12.78%

d. 13.13%

Q2: Calculate the nominal interest p.a. compounded daily that is equivalent to 3.7% p.a. compounded quarterly. (Correct your answer to the nearest 0.01%, e.g. 2.12%)