If a bank pays a 6% annual percentage rate, with quarterly compounding, on deposits, what effective...
If a bank pays a 6% annual percentage rate, with quarterly compounding, on deposits, what effective annual rate does the bank pay?
Homework Answers
To find the annual rate which will give the same amount at annual compounding, as 6% will give with quarterly compounding we need to solve the following equation:
So 6.14% is the annual rate
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If a bank pays a 6% annual percentage rate, with quarterly
compounding, on deposits, what effective...
21) If a bank pays a 3.5% nominal annual rate, with monthly compounding, on deposits, what...
21) If a bank pays a 3.5% nominal annual rate, with monthly compounding, on deposits, what effective annual rate does the bank pay? a. 2.02% b. 2.53% c. 3.04% d. 3.56% e. 4.07%
Assume a bank offers an effective annual rate of 7.12%. If compounding is quarterly what is...
Assume a bank offers an effective annual rate of 7.12%. If compounding is quarterly what is the APR? Answer format: Percentage Round to: 4 decimal places (Example: 9.2434%, % sign required. Will accept decimal format rounded to 6 decimal places (ex: 0.092434)) Please show all steps for better understanding! Thanks!
Assume a bank offers an effective annual rate of 5.64%. If compounding is quarterly what is...
Assume a bank offers an effective annual rate of 5.64%. If compounding is quarterly what is the APR? SHOW WORK
A bank offers a savings account that pays interest quarterly with an effective annual rate (EAR)...
A bank offers a savings account that pays interest quarterly with an effective annual rate (EAR) of 14%. What is the applicable quarterly periodic interest earned in this account? a. 3.50% b. 6.77% c. 13.87% d. 3.33% e. 4.46%
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...
Assume a bank offers an effective annual rate of 5.50%. If compounding is monthly what is...
Assume a bank offers an effective annual rate of 5.50%. If compounding is monthly what is the APR?
John Riviera deposits $14,000 in National Bank at 8% compounded quarterly. What is the effective rate...
John Riviera deposits $14,000 in National Bank at 8% compounded quarterly. What is the effective rate (APY) of interest? (round answer to the nearest hundredth)
Explain the impact of compounding frequency and the difference between annual percentage rate and the effective annual r...
Explain the impact of compounding frequency and the difference between annual percentage rate and the effective annual rate.
Bank One is offering a loan at a 9% nominal rate of interest, with quarterly compounding....
Bank One is offering a loan at a 9% nominal rate of interest, with quarterly compounding. Bank Two is offering an 8.7% nominal rate of interest with monthly compounding. What is the effective rate of interest for each of these loans? Which loan provides a better return?
21) If a bank pays a 3.5% nominal annual rate, with monthly compounding, on deposits, what effective annual rate does the bank pay? a. 2.02% b. 2.53% c. 3.04% d. 3.56% e. 4.07%
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 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...
Bank One is offering a loan at a 9% nominal rate of interest, with quarterly compounding. Bank Two is offering an 8.7% nominal rate of interest with monthly compounding. What is the effective rate of interest for each of these loans? Which loan provides a better return?
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