[Total 5] September 2013 Question 1 15. The rate of interest is 4.5% per annum effective. Calculate: (a) the annual effective rate of discount. TUTE OF ACTUARIAE (b) the nominal rate of discount per annum convertible monthly (c) the nominal rate of interest per annum convertible quarterly. (d) the effective rate of interest over a five year period. [5] (ii) Explain why your answer to part (i)(b) is higher than your answer to part (i)(a). [2] [Total 7] Sonton