The interest rate that accounts for compounding over 12 months is called ____________?

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Accepted Answer

Effective annual return - The interest rate that considers compounding throughout the year is called the Effective Annual Return (EAR). It reflects the actual annual yield on an investment after accounting for compounding periods, making it more accurate than the nominal rate.

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The interest rate that accounts for compounding over 12 months is called ____________?

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MCQ Detailed View

The interest rate that accounts for compounding over 12 months is called ____________?

Detailed Explanation

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In cash flow analysis, two projects are compared using a common life approach, which is classified as…

In capital budgeting, the Internal Rate of Return (IRR) of a project is classified as its ____________?…

In evaluating independent projects, the results of Internal Rate of Return (IRR) and Net Present Value…