A nominal rate of 8% compounded quarterly means the interest rate per period is
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Answer: b. 2%
- Quarterly means 4 periods per year.
- Periodic rate .
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Term 3 · Week 1 · Compound Interest
Basic problem
Common errors to watch for
- (d) 4% would be semi-annual compounding.
- (c) 0.5% is 6% compounded monthly.
Budget of Work competencies
- gm11.t3.w1.c1
Solve problems involving compound interest, including maturity value, future value, nominal rates, and number of terms.