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1000 dollars is deposited into an account at the beginning of the year and the value...

1000 dollars is deposited into an account at the beginning of the year and the value at the end of five years is 1276.30.

- If the discount was converted monthly, the nominal discount rate is? (That is, d(12) = )

- If the account was subject to a force of interest δ(t) = kt where t is in years, k =?

- If inflation is 1 percent a year, what is the adjusted effective yearly interest rate?

- If the interest was compounded monthly, the nominal interest rate is? (That is, i(12) =)

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Answer #1

Answers.

1. d(12)=4.8694%

2. K=0.048793

3. Rate=3.96%

4. i(12)= 4.889%

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