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16.07.2019 •
Business
True or false: increasing the confidence level will lead to a wider margin of error.
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Ответ:
Ответ:
The Bank has to report the interest rate at 14.85% to meet law requirement.
Explanation:
Please find the below for details explanations and calculations:
As required by law, the Bank has to report the nominal interest rate it is going to charge to potential borrowers.
We have been given effective annual rate, thus, we may derive nominal interest rate from the effective annual rate, denoted as i, by the below calculation:
(1+ effective annual rate) = ( 1 + i/365)^365 <=> 1.16 = ( 1 + i/365)^365 <=> i = 14.85%.
Thus, the answer is 14.85%.