SOLUTION: Suppose your credit card issuer states that it charges a 17.00% nominal annual rate, but you must make monthly payments, which amounts to monthly compounding. What is the effective

Algebra ->  Finance -> SOLUTION: Suppose your credit card issuer states that it charges a 17.00% nominal annual rate, but you must make monthly payments, which amounts to monthly compounding. What is the effective      Log On


   

Question 1148908: Suppose your credit card issuer states that it charges a 17.00% nominal annual rate, but you must make monthly payments, which amounts to monthly compounding. What is the effective annual rate?
A) 18.19%
B) 17.99%
C) 18.39%
D) 18.79%
E) 18.59%
Answer by Boreal(15235) About Me  (Show Source):
You can put this solution on YOUR website!
this is(1+(0.17/12))^12=1.18389
subtract original 1 and this is 18.39%
C