Question: What is the difference between stated and effective interest rates? The stated interest rate is the nominal rate, while the effective interest rate takes into

What is the difference between stated and effective interest rates?
The stated interest rate is the nominal rate, while the effective interest rate takes into account compounding.
The stated interest rate is the effective rate, while the effective interest rate is the nominal rate.
The stated interest rate is the annual rate, while the effective interest rate is the monthly rate.
The stated interest rate is the rate given by the lender, while the effective interest rate is the rate agreed upon by the borrower.

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