Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Concept explainers

Effective Interest Rate
The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.
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Mark is saving money to buy a Tesla, so he deposits $254 at the end of every month into a savings account. At the end of 5 years from now, Mark has saved a total of $24,892. What monthly interest rate did Mark earn? (note: if your answer is 17.25% then write 17.25 as your answer; do not include percentage signs)
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Transcribed Image Text:Mark is saving money to buy a Tesla, so he deposits $254 at the end of every month into a savings account. At the end of 5 years from now, Mark has saved a total of $24,892. What monthly interest rate did Mark earn? (note: if your answer is 17.25% then write 17.25 as your answer; do not include percentage signs)
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