Asked by ALBERT
Suppose that a money market fund pays a nominal rate of interest of 8.7 percent convertible monthly. What is the equivalent nominal rate convertible quarterly?
Answers
Answered by
Reiny
let the equivalent nominal rate compounded quarterly be j
Consider one year.
(1+.087/12)^12 = (1 + j/4)^4
1.00725^3 = 1+j/4
.051908068 = j/4
j = .087632274 or 8.763 %
Consider one year.
(1+.087/12)^12 = (1 + j/4)^4
1.00725^3 = 1+j/4
.051908068 = j/4
j = .087632274 or 8.763 %
There are no AI answers yet. The ability to request AI answers is coming soon!
Submit Your Answer
We prioritize human answers over AI answers.
If you are human, and you can answer this question, please submit your answer.