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Question
The effective yield is the annual rate i that will produce the same interest per year as the nominal rate compounded n times per year. For a rate that is compounded n times per year, the formula for effective yield is given as
. Find the effective yield for a nominal rate of 6%, compounded monthly. Round your answer to two decimal places.A) 0.62%
B) 6.41%
C) 6.80%
D) 1.18%
E) 6.17%
Answer
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