Rates to nominal vs. effective rates

Reference no: EM13293913

1. Interest rates are a prominent topic nowadays. We should all be familiar with the impact that interest rate fluctuations can have on the economy, in finance, and our daily lives. However, when we are quoted a rate, is the quote the APR or the EAR of interest? How can we relate these rates to nominal vs. effective rates? What is the difference?

2. We are all affected by the time value of money. And, many of us observe (or experience) this on a daily basis without necessarily realizing that we are a part of this application. Think of several examples that directly impact you.

Reference no: EM13293913

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