Question: 4. Consider the interest rate 8% compounded quarterly. (a) Find an equivalent interest rate compounded semi-annually. (b) Assume that a principal of $1000 was invested
4. Consider the interest rate 8% compounded quarterly. (a) Find an equivalent interest rate compounded semi-annually. (b) Assume that a principal of $1000 was invested for a year. Show that over the year, both of these interest rates will yield the same future value. (c) how else could we determine the answer we got from (a) is equivalent to the given rate? Calculate these values to show they are equivalent.
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