A four-year project promises to pay 0.56% interest per month. An investor is trying to decide between
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Question:
A four-year project promises to pay 0.56% interest per month. An investor is trying to decide between investing in this project or investing in a semi-annually compounded four-year GIC. Above what interest rate would the GIC need to offer to make it a more appealing investment?
Expert Answer:
To compare the two investment options we need to calculate the effective interest rate for both the ... View the full answer
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