Your bank account pays an 8 nominal rate of interest the


Your bank account pays an 8% nominal rate of interest. The interest is compounded quarterly. Which of the following statements is CORRECT? a. The periodic rate of interest is 4% and the effective rate of interest is less than 8%. b. The periodic rate of interest is 2% and the effective rate of interest is 4%. c. The periodic rate of interest is 2% and the effective rate of interest is greater than 8%. d. The periodic rate of interest is 8% and the effective rate of interest is also 8%. e. The periodic rate of interest is 8% and the effective rate of interest is greater than 8%.

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Financial Management: Your bank account pays an 8 nominal rate of interest the
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