CUET · MATHS · PYQ PAPER 2023
The effective rate that is equivalent to a nominal rate of \(12 \%\) compounded quarterly is :
- A \(10.55 \%\)
- B \(12.55 \%\)
- C \(12.25 \%\)
- D \(11.55 \%\)
Answer & Solution
Correct Answer
(B) \(12.55 \%\)
Step-by-step Solution
Detailed explanation
\(r_{eff} = (1 + \frac{r_{nom}}{n})^n - 1\) \(r_{eff} = (1 + \frac{0.12}{4})^4 - 1\) \(r_{eff} = (1.03)^4 - 1\) \(r_{eff} = 1.12550881 - 1\) \(r_{eff} = 0.12550881 \approx 12.55 \\%\)
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