Q82
The expansion of EAR is?
A.
equivalent annual rate
AnswerB.
equivalent annuity rate
C.
equally applied rate
D.
equal advance rate
Answer: Option A
Solution
Answer: Option A
Solution:
The expansion of EAR is equivalent annual rate. The Effective Annual Rate (EAR) is the interest rate that is adjusted for compounding over a given period. Simply put, the effective annual interest rate is the rate of interest that an investor can earn (or pay) in a year after taking into consideration compounding.