SOLUTION: Find the effective rate corresponding to the given nominal rate 10% compounded semiannually. ​ a. 10 1/4% b. 9 1/4% c. 10 1/2% d. 9 1/8% PLEASE EXPLAIN. THANK

Algebra ->  Expressions -> SOLUTION: Find the effective rate corresponding to the given nominal rate 10% compounded semiannually. ​ a. 10 1/4% b. 9 1/4% c. 10 1/2% d. 9 1/8% PLEASE EXPLAIN. THANK      Log On


   

Question 1053982: Find the effective rate corresponding to the given nominal rate 10% compounded semiannually.
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a. 10 1/4%
b. 9 1/4%
c. 10 1/2%
d. 9 1/8%
PLEASE EXPLAIN. THANK YOU.
Answer by rfer(16322) About Me  (Show Source):
You can put this solution on YOUR website!
A=10(1+0.10/2)^2
A=10(1.05)^2
A=10(1.1025)
Just set up a simple little problem to look at.
a) 10.25%
a) 10 1/4%