Question $1$

Which of the following statements regarding the interest rates is correct?

I A$.$ a result of compoundine, the effective annual rate on a bank deposit $($or ib loan$)$ is always equal to or less than the nominal rate on the deposit lor loanl.

II If we are given a periodic interest rate, sy a monthly rate, we can find the nominal annual rate by multiplying the periodic rate by the number of periods per year.

III If a loan or an investment uses annual compounding, its nominal rate is also its effective rate

I and III only

II and III only

I and II only

II only