Question $21(1$ point$)$

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Your investment advisor informs you that you can check the returns on the investments he suggests for you for one month before making a decision for a longer$-$term contract. If your advisor makes a $1\%$ return on the investment in the first month, what is the EAR of thils investment if the earnings rate could be extrapolated for one year? $($Assume there is no advising fee for the entire period.$)$

$12\mathrm{.}00\%$

$12\mathrm{.}68\%$

$1\mathrm{.}00\%$

$126\mathrm{.}82\%$