Asked by Dylan Gauthier on Jun 05, 2024
Verified
An annual rate of 4% is applied as a semiannual rate of 1%.
Annual Rate
The Annual Rate is the interest rate or growth rate for a year, often used in financial contexts to depict investments or loans.
Semiannual Rate
A rate of interest or growth that is calculated or applied twice per year.
- Acquire knowledge on the essential aspects of present value computations and their applications in assessing bonds and installment notes.
Verified Answer
TW
Teelyly WangchiaxaJun 07, 2024
Final Answer :
False
Explanation :
To convert an annual rate to a semiannual rate, we divide the annual rate by 2. Therefore, an annual rate of 4% would be equivalent to a semiannual rate of 2%.
Learning Objectives
- Acquire knowledge on the essential aspects of present value computations and their applications in assessing bonds and installment notes.