Question: 1. Mention the interest rate type and compounding period. Statement 15% per year 15% per year compounded monthly 15% per year compounded yearly 15%

1. Mention the interest rate type and compounding period. Statement 15% per

1. Mention the interest rate type and compounding period. Statement 15% per year 15% per year compounded monthly 15% per year compounded yearly 15% per year compounded continuously Nominal or Effective Compounding period 2. Given that interest rate is nominal 1% per month. What is the nominal interest rate for 1.5 year? Hints: very simple case. 3. A bank charges 20% interest per year, compounded monthly. What is the effective annual interest rate? 4. Given that cash flow sequence is $100 per quarter (3-month) for 2 years and interest rate is 1% per month. What is effective interest rate for 1 quarter? 5. if the nominal annual interest rate, r=20% per year, what is the effective continuous rate per year?

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