From the Following Extract of an Amortisation Schedule Pertaining to a Compound

question 51

Multiple Choice

From the following extract of an amortisation schedule pertaining to a compound financial instrument,what is the effective-interest rate embodied in the instrument?

• A) 6 per cent.
• B) 5 per cent.
• C) Variable, as shown in the table it has increased from 5.5837 per cent in period 1 to 6.2738 per cent in period 3.
• D) 4 per cent.
• E) Cannot determine from the above information.

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