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Find the EAR in each of the following cases:
| Stated Rate (APR) | Number of Times Compounded | Effective Rate (EAR) | ||||
| 8.8 | % | Quarterly | % | |||
| 17.8 | Monthly | |||||
| 13.8 | Daily | |||||
| 10.8 | Infinite |
♦ Relevant knowledgeThe annual percentage rate (APR) is the popular method of quoting the interest rate on a loan however it may not accurately represent the actual cost of borrowing as it does not take into account compounding of interest.
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