Question
The effective annual rate of interest corresponding to a nominal rate of 6% per annum payable half-yearly is:
Answer: Option D
- Amount of Rs. 100 for 1 year
when compounded half-yearly } = Rs. 100 x ( 1 + 3 ) 2 = Rs. 106.09 100
Effective rate = (106.09 - 100)% = 6.09%
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- Amount of Rs. 100 for 1 year
when compounded half-yearly } = Rs. 100 x ( 1 + 3 ) 2 = Rs. 106.09 100
Effective rate = (106.09 - 100)% = 6.09%
Was this answer helpful ?
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