Question: 1. A nominal annual interest rate is 8.50%, compounded monthly. What are equivalent effective monthly and annual interest rates? 2. If the effective monthly

1. A nominal annual interest rate is 8.50%, compounded monthly. What are

1. A nominal annual interest rate is 8.50%, compounded monthly. What are equivalent effective monthly and annual interest rates? 2. If the effective monthly interest rate is 1.50% per month, what is the effective quarterly rate? 3. If the nominal annual interest rate, r, is 9.00% per year, compounded semi-annually, what is the effective annual interest rate, i? 4. If the effective annual interest rate is 9.0% per year, what is the effective quarterly interest rate?

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1 The equivalent effective monthly interest rate is 0 70 The equivalent effective annual interest rate is 8 36 0 70 1 0 08 5 12 12 1 8 36 1 0 70 12 1 ... View full answer

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