At What Quarterly Compounded Nominal Interest Rate Will Money Double

question 92

Multiple Choice

At what quarterly compounded nominal interest rate will money double in 75 months?

• A) 11.25%
• B) 15.06%
• C) 3.77%
• D) 28.11%
• E) 11.73%

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Definitions:

Carrying Value

The net amount at which an asset is valued on the balance sheet, taking into account depreciation, amortization, and impairment costs.

Effective-Interest Method

A method of amortizing the discount or premium on bonds payable over the life of the bonds, providing a periodic interest expense that reflects a constant rate of interest.

Discount on Bonds Payable

The difference between the face value of a bond and its selling price when a bond is sold for less than its face value.

Interest Expense

The expenses an entity faces for borrowing money, encompassing loans, bonds, or credit lines.