Question: What is the difference between the stated annual rate and the effective annual rate? The stated annual rate is always lower than the effective annual

What is the difference between the stated annual rate and the effective annual rate? The stated annual rate is always lower than the effective annual rate The stated annual rate is always higher than the effective annual rate The stated annual rate is the effective annual rate, whilst the effective annual rate is the contractual annual rate of interest The stated annual rate is the contractual annual rate of interest, whilst the effective annual rate reflects the impact of compounding frequency

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