Find the Nominal Interest Rate That, When Compounded Monthly, Yields

question 232

Multiple Choice

Find the nominal interest rate that, when compounded monthly, yields an effective interest rate of 6% / year.

• A) 5.91%
• B) 5.83%
• C) 5.84%
• D) 5.87%

---

Definitions:

Personally Bound

Being legally obligated on an individual basis, usually in terms of contractual or financial responsibilities.

Contract

A contract among two or more entities that holds legal enforceability.

Authority

The right or power assigned to an entity or individual to govern, make decisions, or enforce obedience.

Revocation

The official cancellation or annulment of a decree, decision, or promise, typically within legal contexts such as wills, contracts, or licenses.