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Find the EAR in each of the following cases (Use 365 days a year. Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.): Stated Rate (APR) Number of Times Compounded Effective Rate (EAR) 9.4 % Quarterly % 18.4 Monthly 14.4 Daily

Answer :

Answer and Explanation:

The computation of the effective annual rate in each of the following cases is shown below;

a. For quarterly

Effective annual rate = (1+0.094 ÷ 4)^4 - 1

= 9.74%

b. For monthly

Effective annual rate = (1+0.184 ÷ 12)^12 - 1

= 20.03%

c. For daily

Effective annual rate = (1+0.144 ÷ 365)^365 - 1

= 15.49%

In this way it should be calculated and measured  

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