Question 1204110
growth rate per year = 4% / 100 = .04.
growth rate per quarter = .04/4 = .01.
growth factor per quarter = that + 1 = 1.01.
effective growth factor per year = 1.01 ^ 4 = 1.04060401.
effective growth rate per year = that - 1 = .04060401 * 100 = 4.060401% per year.
that's the effective annual interest rate when the annual innterest rate is compounded quarterly.