What quarterly rate should we apply to the payments

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Reference no: EM131962441

1. An investor is trying to determine the proper interest rate to apply to an account. The account pays 4.20% APR with monthly compounding. However, the payments on the account are once per quarter or once every three months. What quarterly rate should we apply to the payments on the account?

2. Becky has promised you $3,130.00, one year from today. In addition, each year after that , she has promised a payment (on the anniversary of the last payment) that is 3.00% larger than the last payment. She will continue to show this generosity for 25 years, giving a total of 25 payments. If the interest rate is 10.00%, what is her promise worth today?

Reference no: EM131962441

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