Question

what will be the effecient rate of interest for the first year ,if the rate of interest is 40%p.a. compounded semi annually

Answer 1

Answer:

For investment A, this would be: 10.47% = (1 + (10% / 12)) ^ 12 - 1.

Answer 2

Answer:

Answer: Effective annual interest rate = (1 + (nominal rate / number of compounding periods)) ^ (number of compounding periods) - 1. For investment A, this would be: 10.47% = (1 + (10% / 12)) ^ 12 - 1.