Question: 4. Let rm be the interest rate with m compoundings per year, for example, 12 means monthly compounding. m = (a) Derive the formula to

4. Let rm be the interest rate with m compoundings per

4. Let rm be the interest rate with m compoundings per year, for example, 12 means monthly compounding. m = (a) Derive the formula to convert rm to r'n for general m, n = 1, 2, 4, 12. (b) Let rc be the continuous compounding rate. Derive the formula to convert rm to rc and vice-versa. (c) Convert a simple add-on rate to a compounded rate rm (m = 1, 2, 4, 12) and vice-versa. (d) Convert a simple add-on rate to a continuously compounded rate and vice-versa. (e) For m

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