What Continuously Compounded Effective Rate of Interest Will Yield the Same

question 9

Multiple Choice

What continuously compounded effective rate of interest will yield the same present value of a future cash flow as an annual rate of interest of 2.25%?

• A) 2.23%
• B) 3.15%
• C) 0.95%
• D) 1.28%

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Definitions:

Greater Than

A mathematical symbol (>) denoting that a value on the left is larger than the value on the right.

Four Firms

Often refers to a concentration ratio in economics that measures the output or revenue share of the four largest firms within an industry.

Industry Table

A tabular representation of data that shows information specific to a particular industry, often including metrics like production, sales, and employment.

Four-Firm Concentration Ratio

A measure of market concentration that calculates the combined market share of the four largest firms in an industry.