Question
Suppose National Bank offers to lend you $10,000 for one year at a nominal annual rate (annual percentage rate) of 8.00%, but you must make
Suppose National Bank offers to lend you $10,000 for one year at a nominal annual rate (annual percentage rate) of 8.00%, but you must make interest payments at the end of each quarter and then pay off the $10,000 principal amount at the end of the year. What is the effective annual rate (EAR) on this loan?
| 8.00% | ||
| 8.24% | ||
| 8.30% | ||
| 8.33% |
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Mathematical Finance Core Theory Problems And Statistical Algorithms
Authors: Nikolai Dokuchaev
1st Edition
0415414482, 978-0415414487
