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Hello,
I am unsure how to calculate the interest rates for this quetsion:
Given that the annual rate compounded continuously is 12.5%, find the equivalent rate
per:
year compounded daily
monthly compounded monthly
year copounded every two years
Step by step
Solved in 3 steps with 2 images
- An interest rate is quoted as 3.75% per year compounded quarterly, what is the effective semi-annual rate?The discount factor corresponding to a 3-year continuously compounded interest rate is 0.765667. What is the corresponding continuously compounded interest rate? What is the corresponding quarterly compounded interest rate expressed at an annual rate?For a sum of 1,050 to triple itself in 8 years and 6 months, what must be the rate of interest compounded semi-annually? (Finding the rate by linear interpolation)
- If the nominal rate is 16.5% per year compounded quarterly, what is the equivalent effective rate of interest per three yearsFind the effective annual interest rate r of the given nominal annual interest rate. Round your answer to the nearest 0.01%. 12% compounded monthlyif the nominal rate is 11.5% per year compounded continuously, what is the equivalent effective rate of interest per two years?
- Which one of the following represents the highest effective interest rate per year? Select one: O a. 10.5% per year, compounded semiannually Ob. 10.4% per year, compounded daily O c. 10% per year, compounded quarterly O d. 10% per year, compounded monthly O e. 9.8% per year, compounded continuouslySuppose you deposit $4,000 at the end of each quarter for five years at an interest rate of 8% compounded monthly. Which of the formulas given next will determine the equal annual end-of-year deposit amount that would accumulate the same balance over five years, under the same interest compounding, as the $4,000 deposited quarterly?(a) A= ($4,000 (FIA, 2.01%,20)] x (AIF, 8%, 5).(b)A = $4,000 (FIA, 9%, 5).(c) A= $4,000 (FIA, 9%, 20) x (AIF, 9%, 5).(d) None of the above.if the nominal rate is 11.5% per year compounded continuously, what is the equivalent effective rate of interest per bi month
- If interest is paid at a rate of 5% per year, compounded quarterly, what is the effective annual rate?What is the accumulated value after five years of payments of $20000 made at the beginning of each year if interest is 7% compounded quarterly? Please, note that I think this is a question of Annuities, and I believe time would be 20 (5 years compounded quarterly -> 4x a year) Isn't this a General Annuity Due question, where payments are made at the beginning of the payment intervals, and the payment and compounding frequencies are unequal.For an interest rate of 2% per month, find (a) the effective rate per quarter, and (b) the effective rate per year.