Question

10% per vear compounded monthly this interest rate is a an interest is advertised in the newspaper as 'APY nominal rate True False Question 2 (4 points) Saved A nominal interest is an interest rate that does not account for compounding. In other words, a nominal Interest rate, is an interest rate that does not include any consideration of compounding True False Question 3 (4 points) Saved rest i ti med to be equal to the period over which the compounding period is not sated for a particular the new s expressed True False Question 4 (4 points) The wathematic he True False OOOOO0OBEE

Answer 1

1.

True

The stated expression shows that interest rate is stated to be other than the impact of compounding. So, it is an example of nominal interest rate.

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2.

True

It is the effective interest rate that is calculated after the consideration of compounding.

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3.

False

If compounding is not mentioned, then compounding is on annual basis.

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4.

True

It is the condition under PW analysis to conduct and satisfy equal service requirement.