Answer:
daily interest rate is 3.717%
monthly interest rate is 3.712%
Step-by-step explanation:
We are given
APR=3.65%
We can use formula
[tex]EAR=(1+\frac{APR}{m})^{m}-1[/tex]
where
EAR is effective interest rate
APR is annual interest rate
m is number of periods
(a)
For daily:
APR=3.65%=0.0365
m=365
so, we can plug this value
[tex]EAR=(1+\frac{0.0365}{365})^{365}-1[/tex]
[tex]EAR=0.03717[/tex]
So, daily interest rate is 3.717%
(b)
For monthly:
APR=3.65%=0.0365
m=12
so, we can plug this value
[tex]EAR=(1+\frac{0.0365}{12})^{12}-1[/tex]
[tex]EAR=0.03712[/tex]
So, monthly interest rate is 3.712%
