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What is the effective annual rate (EAR) of interest on a certificate of deposit that has a nominal rate of 5.5% with interest compounded quarterly?

What is the effective annual rate (EAR) of interest on a certificate of deposit that has a nominal rate of 5.5% with interest compounded quarterly? Round up to TWO (2) decimal places.

Select one:

A.

5.64%

B.

5.58%

C.

5.50%

D.

5.61%

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