Effective rate of discount


You are given a loan on which interest is charged over a 4 year period as follows:

an effective rate of discount of 6% for the first year

a nominal rate of discount of 5% compounded every 2 years for the second year

a nominal rate of interest of 5% compounded semiannually for the third year

a force of interest of 5% for the fourth year

Calculate the annual effective rate of interest over the 4 year period.

Request for Solution File

Ask an Expert for Answer!!
Basic Statistics: Effective rate of discount
Reference No:- TGS0749636

Expected delivery within 24 Hours