Which of the following APRs compounded monthly is equivalent to an APR of 14.15% compounded quarterly using 360day calendar years, 30day months, and 3month quarters?


Quarterly compounding=((1+r/n)^n)1
r=interest rate
n=number of periods=4 (4 quarters in a quarter)
Quarterly compounding=((1+(14.15%/4))^4)1=14.92%
Now check the each option below by compounding monthly
i) Monthly compounding=((1+(12.96%/12))^12)1=13.76%
ii) Monthly compounding=((1+(13.32%/12))^12)1=14.16%
iii) Monthly compounding=((1+(13.68%/12))^12)1=14.57%
iv) Monthly compounding=((1+(14.04%/12))^12)1=14.98%
Option iv is almost equal to quarterly compounding value
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