An effective rate of 29,61% corresponds to a nominal rate, compounded weekly, of
[1] 34,35%.
[2] 29,53%.
[3] 26%.
[4] 29,61%.
[5] none of the above
Let effective interest rate=iii ,
nominal interest rate is jjj ,
i=100((1+jm)m−1)i=100((\frac{1+j}{m})^m-1)i=100((m1+j)m−1)
29.61=100((1+r52)52−1)29.61=100((1+\frac {r} {52} )^{52}-1 )29.61=100((1+52r)52−1)
Put r=26,
29.61=100((1+2652)52−1)29.61=100((1+\frac {26} {52} )^{52}-1 )29.61=100((1+5226)52−1) ,
29.61=29.61.
LHS=RHS.
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