Q70
The effective annual rate of interest, corresponding to a nominal rate of 6% per annum payable half yearly is = ?
A.
6.06%
B.
6.07%
C.
6.08%
D.
6.09%
AnswerAnswer: Option D
Solution
Answer: Option D
Solution:
\begin{aligned}
& {\text{Half yearly rate}} \\
& {\text{ = }}\frac{6}{2} = 3\% \\
& {\text{Effective rate % }} \\
& {\text{ = 3}} + {\text{3}} + \frac{{3 \times 3}}{{100}} \\
& = 6.09\% \\\end{aligned}