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28-03-2024
Business

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A loan charges an APR of 11 percent with payments made quarterly. How is the EAR computed?

a) EAR = (1 + 0.11)⁴ - 1
b) EAR = (1 + 0.11)¹2 - 1
c) EAR = (1 + 0.11/4)⁴ - 1
d) EAR = (1 + 0.11/12)¹2 - 1

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