Nico Is the New Assistant Branch Manager of a Larger

question 169

Essay

Nico is the new assistant branch manager of a larger Florida-based bank and the branch manager has asked him a question to test his knowledge. The question he asked is which rate should the bank advertise on monthly-compounded loans, the nominal annual percentage rate or the effective annual percentage rate? Which rate should the bank advertise on quarterly-compounded savings accounts? Explain. As a consumer, which would you prefer to see and why?

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Definitions:

Economist Amartya Sen

An Indian economist and philosopher, noted for his contributions to welfare economics, social choice theory, and for his work on famine, human development theory, and the underlying mechanisms of poverty.

Famine

Famine is a severe shortage of food, often due to disaster, war, or economic failure, leading to widespread hunger and malnutrition.

Unequal Access

A situation where different groups or individuals have varying levels of access to resources, information, or opportunities, often leading to disparities and inequality.

Sex Ratio

A demographic measure indicating the number of males for every 100 females in a population.