ZuoTi.Pro
Question

Which one of the following is true?(rounding to the nearest hundredths)


Question 22 

Which one of the following is true?(rounding to the nearest hundredths) 

  • You invest $100 today. If you earn 2% per quarter, the annual percentage rate is 6%. 

  • The effective annual rate of 6% compounded continuously is 6.4%. 

  • If the monthly rate is 0.2%, the annual percentage rate is 1.2% 

  • If the APR is 12% with daily compounding, effective annual rate is 12.75%

  • If the annual percentage rate is 12% with quarterly compounding, then the period rate is 4% per quarter.



Question 23 

Solve for the unknown number of years: Present Value-$810, Interest Rate=8%, Future Value=$1,821, Number of years=? 

  • 28.71 years 

  • 17.42 years 

  • 31.99 years 

  • 10.53 years 

  • 12.43 years

business   finance   
1 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

Q-22

The Answer is d)

As :-

=(1+12%/365)^365-1 = 12.75%

Q-23

Number of years have been calculated using the NPER function:-

=NPER(rate,pmt,pv,fv)

=NPER(8%,0,-810,1821)

=10.53 years

0 0
Add a comment
Know the answer?
Add Answer to:
Which one of the following is true?(rounding to the nearest hundredths)
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • A current value of $50,000 is held in an account earning 12% APR. Equal payments are...

    A current value of $50,000 is held in an account earning 12% APR. Equal payments are to be paid out quarterly until the account is depleted after 8 years. How much would the equal quarterly payments be under each of the following interest compounding scenarios? (Hint: first find the effective interest for each scenario to the nearest 10,000th of a percent. Then, find the value of the equal payments to the nearest $0.01.) A. 12% APR Compounded Quarterly (4 quarters...

  • Periodic interest rates. In the following table, , fill in the periodic rates and the effective...

    Periodic interest rates. In the following table, , fill in the periodic rates and the effective annual rates. First, fill in the periodic rates in the following table. (Round to two decimal places.) Compounding per Year Effective APR Period Periodic Rate Annual Rate Semiannual 7% 2 Data Table (Click on the following icon 9 in order to copy its contents into a spreadsheet.) Compounding per Year Effective Period APR Periodic Rate Annual Rate Semiannual 7% 2 Quarterly Monthly Daily 8%...

  • Periodic interest rates. In the following table, fill in the periodic ra First, fill in the...

    Periodic interest rates. In the following table, fill in the periodic ra First, fill in the periodic rates in the following table. (Round to two decim (Click on the following icon in order to copy its contents into a spreadsheet.) APR Compounding per Year APR Compounding per Year - 2 Effective Annual Rate Periodic Rate Period Semiannual 7% 7% Period Semiannual Quarterly Monthly Daily 8% Quarterly Periodic Rate 3.50 % 2.00 % 0.50 % 0.0089 % 6 % 8% 6%...

  • 22/23 An investor contributes $528.00 per quarter in an account that pays 5.28% APR with quarterly...

    22/23 An investor contributes $528.00 per quarter in an account that pays 5.28% APR with quarterly compounding. The first contribution will be made next quarter. What is the future value of this account in 5.00 years? Submit Answer format: Currency: Round to: 2 decimal places. A lender offers you a mortgage with an APR of 5.04% with monthly compounding. What is the effective rate of interest charged by the lender? Submit Answer format: Percentage Round to: 2 decimal places (Example:...

  • Christine O'Brien, who is self-employed, wants to investa. Choose the investment which will earn the most $80,000 in a pension plan. One investment offers 6% compounded quarterly. Another offers...

    Christine O'Brien, who is self-employed, wants to investa. Choose the investment which will earn the most $80,000 in a pension plan. One investment offers 6% compounded quarterly. Another offers 5.75% compounded continuously. a. Which investment will earn the most interest in 5 years? b. How much more wil the better plan earn? C. What is the effective rate in each case? interest below O compounded continuously O compounded quarterly b. The difference is $ d. If Ms. O'Brien chooses the...

  • For nominal interest rate of compounding is continuous. Show your solution 3. %, effective annual interest...

    For nominal interest rate of compounding is continuous. Show your solution 3. %, effective annual interest rate will be 12% when 4. Under what conditions APR will be different from EAR? L. Shark is designing a new account that pays interest quarterly. They wish to pay effectively, a 16% per year on this account. L. Shark desires to advertise the annual percentage rate on this new account (and not the effective rate, since their competitors state their interest on an...

  • For nominal interest rate of compounding is continuous. Show your solution 3. %, effective annual interest...

    For nominal interest rate of compounding is continuous. Show your solution 3. %, effective annual interest rate will be 12% when 4. Under what conditions APR will be different from EAR? L. Shark is designing a new account that pays interest quarterly. They wish to pay effectively, a 16% per year on this account. L. Shark desires to advertise the annual percentage rate on this new account (and not the effective rate, since their competitors state their interest on an...

  • Which of the following is CORRECT? When discounting an amount to be received in one year's...

    Which of the following is CORRECT? When discounting an amount to be received in one year's time at a rate that is quoted as 12% compounding quarterly, we can: Select one: A. Discount the amount using an effective monthly rate of 1% where the number of periods is 12. B. Discount the amount using an effective annual rate (EAR) of (1+0.03)^4-1 =12.5509% where number of periods is 1. C. Discount the amount using the annual rate of 12% where number...

  • Question 10 Which of the following is CORRECT? When discounting an amount to be received in...

    Question 10 Which of the following is CORRECT? When discounting an amount to be received in one year's time at a rate that is quoted as 12% compounding quarterly, we can: Select one: A. Discount the amount using an effective monthly rate of 1% where the number of periods is 12. B. Discount the amount using an effective annual rate (EAR) of (1+0.03)^4-1 =12.5509% where number of periods is 1. C. Discount the amount using the annual rate of 12%...

  • PLEASE ANSWER THIS QUESTION AND MOST ANSWER TO QUANTITATIVE PROBLEM THANKS YOU Different compounding periods, are...

    PLEASE ANSWER THIS QUESTION AND MOST ANSWER TO QUANTITATIVE PROBLEM THANKS YOU Different compounding periods, are used for different types of investments. In order to properly compare investments or loans with different compounding periods, we need to put them on a common basis. In order to do this, you need to understand the difference between the nominal interest rate (INOM) and the effective annual rate (EAR). The -Select- v interest rate is quoted by borrowers and lenders, and it is...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT