Q6. The continuously compounded rate is: A) 9.67%. B) 9.20%. C) 9.42%.
Q7. What’s the effective rate of return on an investment that generates a return of 12%, compounded quarterly? A) 14.34%. B) 12.00%. C) 12.55%.
Q8. Peter Wallace wants to deposit $10,000 in a bank certificate of deposit (CD). Wallace is considering the following banks: § Bank A offers 5.85% annual interest compounded annually. § Bank B offers 5.75% annual interest rate compounded monthly. § Bank C offers 5.70% annual interest compounded daily. Which bank offers the highest effective interest rate and how much? A) Bank B, 5.90%. B) Bank A, 5.85%. C) Bank C, 5.87%.
Q9. A local loan shark offers 4 for 5 on payday. What it involves is that you borrow $4 from him and repay $5 on the next payday (one week later). What would the stated annual interest rate be on this loan, with weekly compounding? Assuming 52 weeks in one year, what is the effective annual interest rate on this loan? Select the respective answer choices closest to your numbers. A) 25%; 1,300%. B) 1,300%; 10,947,544%. C) 25%; 300%.
Q10. What is the effective annual rate if the stated rate is 12% compounded quarterly? A) 57.35%. B) 12.55%. C) 12.00%.
[此贴子已经被作者于2008-12-29 17:01:48编辑过] | 
发表于 2008-12-29 16:29
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