math

find the effectivee rate correspoding to 3% compounded quarterly


The formula for effective rate I found is (1+ i/n)^n - 1
where i is the annual rate as a decimal and n is the number of periods.
Here i=.03 so the effective rate is and n is 4 since there are 4 compounding periods.
(1+ .03/4)^4 - 1 = something you can do. If you want it as a percentage, multiply the number by 100 an use the % symbol.

BTW, are you the person who asked this question on Sunday?
"you have deposited 1000 dollars in your savings account with n annual interest rate of 4 percent compounded monthly. how much money are you going to have in your account after six months?"
"well theres another part of it if you could help me with.

"in the same problem find the effective interest rate after six months? "

You wanted the effective interest rate when i=.04 and the compounding was every 6 mos.

I only ask because I had to repost that one.

  1. 👍
  2. 👎
  3. 👁

Respond to this Question

First Name

Your Response

Similar Questions

  1. Finite Math

    Find the effective rate of interest corresponding to a nominal rate of 6%/year compounded annually, semiannually, quarterly, and monthly. (Round your answers to two decimal places.)

  2. Compound Interest

    A bank offers a rate of 5.3% compounded semi-annually on its four year GICs(Guaranteed Investment Certificates). What monthly and annually compounded rates should it quote in order to have the same effective interest rate at all

  3. Math/ business

    What is the effective rate of the interest rate of the interest when the rate is 6 percent compounded continuously?

  4. math

    The effective rate of interest corresponding a nominal rate of 7% p.a. convertible quarterly is:

  1. Finite Math

    Find the effective rate corresponding to the given nominal rate. (Round your answer to two decimal places.) 11%/year compounded semiannually

  2. math

    Find the effective rate corresponding to the given nominal rate. (Round your answer to the nearest hundredth of a percentage point.) (a) 7%/year, compounded daily % (b) 6%/year, compounded monthly %

  3. calc

    What rate of interest compounded quarterly will yield an effective interest rate of 8%?

  4. Algebra

    Given the equation A=250(1.1)t, you can determine that the interest is compounded annually and the interest rate is 10%. Suppose the interest rate were to change to being compounded quarterly. Rewrite the equation to find the new

  1. Maths

    convert an effective anual interest rate 8% compounded annually to a nominal interest rate of 11.5% p.a compounded monthly correct to one decimal place

  2. math

    Using the present value formula you deposit $12,000 in an account that pays 6.5% interest compounded quarterly. A. find the future value after one year? B. Use the future value formula for simple interest to determine the

  3. Math

    Serena wants to borrow $15 000 and pay it back in 10 years. Interest rates are high, so the bank makes her two offers: • Option 1: Borrow the money at 10%/a compounded quarterly for the full term. • Option 2: Borrow the money

  4. math

    Compute effective rate of interest where nominal rate is 8% compounded quarterly?

You can view more similar questions or ask a new question.