Which of the following offers the highest return? A. 12% nominal rate compounded monthly B. 12.4% nominal rate compounded quarterly C....

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Finance

Which of the following offers thehighest return?
        A. 12% nominalrate compounded monthly
        B. 12.4% nominalrate compounded quarterly
        C. 12.8% nominalrate compounded semi-annually
        D. 13.0% nominalrate compounded annually
        E. Moreinformation is needed to determine the best investment.

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3.7 Ratings (560 Votes)

Option A Annual Interest Rate APR 12 Compounding Period per year n 12 Effective Annual Rate EAR 1 APRnn 1 Effective Annual Rate EAR 1 0121212 1 Effective Annual Rate EAR 10112 1 Effective Annual Rate EAR See Answer

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Which of the following offers thehighest return? A. 12% nominalrate compounded monthly B. 12.4% nominalrate compounded quarterly C. 12.8% nominalrate compounded semi-annually D. 13.0% nominalrate compounded annually E. Moreinformation is needed to determine the best investment.