Multiple Choice
Which of the following statements is most correct?
A) If annual compounding is used,the effective annual rate equals the simple rate.
B) If annual compounding is used,the effective annual rate equals the periodic rate.
C) If a loan has a 12 percent simple rate with semiannual compounding,its effective annual rate is equal to 11/66 percent.
D) Both answers a and b are correct.
E) Both answers a and c are correct.
Correct Answer:
Verified
Correct Answer:
Verified
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