Question

In: Finance

Consider the following investment alternatives: Investment Rate Compounding A 6.25% Annual B 6.10% Daily C 6.125%...

Consider the following investment alternatives:


Investment Rate Compounding
A 6.25% Annual
B 6.10% Daily
C 6.125% Quarterly
D 6.15% Fortnightly
E 6.120% Monthly

Which alternative offers you the highest effective rate of return?

    a.  
Investment E

    b.  
Investment C

    c.  
Investment D

    d.  
Investment A

    e.  
Investment B

Solutions

Expert Solution

Investment D has the highest effective rate of return.

Answer is choice c given.

Calculation as below:


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