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CUET · MATHS · PYQ PAPER 2025

The effective rate, which is equivalent to a nominal rate of \(12 \%\) compounded semi-annually, is

  1. A \(13.16 \%\)
  2. B \(13.36 \%\)
  3. C \(12.36 \%\)
  4. D \(12.16 \%\)
Verified Solution

Answer & Solution

Correct Answer

(C) \(12.36 \%\)

Step-by-step Solution

Detailed explanation

\(r_e = \left(1 + \frac{r}{n}\right)^n - 1\) \(r_e = \left(1 + \frac{0.12}{2}\right)^2 - 1\) \(r_e = (1.06)^2 - 1\) \(r_e = 1.1236 - 1\) \(r_e = 0.1236 = 12.36\%\)
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