# what is the annual equivalent (effective) interest rate if the interest is compounded every week?

Learning Goal: I’m working on a economics question and need an explanation and answer to help me learn.Lecture sides are here: https://drive.google.com/drive/folders/1xWV0IvHoVJ…Homework QuestionsQuestion 1A financial institution is willing to lend you $2,000. However, you must repay $2,008 at the end of week one. What is the interest rate per week?Group of answer choices0.4 %4 %0.004 %0.04 %Question 2In question one, what is the annual equivalent (effective) interest rate if the interest is compounded every week?Group of answer choices24 %23 %22 %21 %Question 3What is the future worth amount of a series of equal quarterly payments of $1,000 for 20 years at an interest rate of 6% per year compounded Quarterly?Question 4In the previous question, what is the future worth if the interest is compounded monthly?Question 5Suppose you deposit $2,000 at the end of each quarter for five years at an interest rate (APR) of 8% compounded monthly. Which of the following formulas will determine the present worth value of your savings at the end of year 5?Group of answer choicesP = $2000(P/A,8%,5)P = $2000(P/A,8%,20)P= $2000(P/A,2.01%,5)P = $2000(P/A,2.01%,20)Question 6How many years will it take an investment to triple if the interest rate is 6% compounded continuously? (round up your answer to the nearest integer)Group of answer choices19222120Question 7The price of a product was $0.88 in the year 2008 and $1.28 in the year 2018. What is the average annual inflation rate for this product?Group of answer choices3.82 %3.68 %3.42 %3. 98 %Question 8If the CPI for January 2008 is 208.837 and the CPI for December 2018 is 255.539, what is the average annual inflation rate (per year) from Jan 2008 to Dec 2018?(Hint: Calculate monthly inflation rate and then use annual effective interest rate)Group of answer choices1.95 %1.65 %1.85 %1.75 %Question 9Given the cash flows in actual dollars provided in the following table, calculate the present worth value of actual cash flow. Assume that the market interest rate is 16% and the general inflation rate is at 4% each year.nCash Flow (in actual dollars)0$20,5004$41,5005$36,5007$55,500Question 10In question 9, convert the cash flows to equivalent cash flows in constant dollars if the base year is time 0. Calculate the present worth value of constant-dollar cash flow.Question 11The purchase of a car requires a $12,000 loan to be repaid in monthly installments for four years at an interest rate (APR) of 9% compounded monthly. If the general inflation rate is 2% per month, find the actual-dollar value of the 20th payment of this loan.Question 12In the previous question, find the constant-dollar value of the 20th payment of the loan.

Requirements: Answer and Calculation sheet