11.33463%

, with interest added (compounded) daily. How much will you have in your account on October 1 , or 9 months later?\ (1) What is the value at the end of Year 3 of the following cash flow stream if the quoted interest rate is

10%

, compounded semiannually?\ (2) What is the PV of the same stream?\ (3) Is the stream an annuity?\ (4) An important rule is that you should never show a nominal rate on a time line or use it in calculations unless what condition holds? (Hint: Think of annual compounding, when

I_(NOM)=EFF%=I_(PER)

.) What would be wrong with your answers to parts (1) and (2) if you used the nominal rate of

10%

rather than the periodic rate,

(I_(NOM))/(2)=10(%)/(2)=5%

?

11.33463%, with interest added (compounded) daily. How much will you have in your account on October 1, or 9 months later? 1. (1) What is the value at the end of Year 3 of the following cash flow stream if the quoted interest rate is 10%, compounded semiannually? (2) What is the PV of the same stream? (3) Is the stream an annuity? (4) An important rule is that you should never show a nominal rate on a time line or use it in calculations unless what condition holds? (Hint: Think of annual compounding, when INOM=EFF%=IPER.) What would be wrong with your answers to parts (1) and (2) if you used the nominal rate of 10% rather than the periodic rate, INOM/2=10%/2=5%