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Mazyrski [523]
3 years ago
5

As a result of compounding, the effective annual rate on a bank deposit (or a loan) is always equal to or greater than the nomin

al rate on the deposit (or loan). True False
Business
1 answer:
Rina8888 [55]3 years ago
4 0

It should be noted that the effective annual rate on a bank deposit is always equal to or greater than the nominal rate on the deposit. Therefore, it is true.

<h3>What is effective annual rate?</h3>

The effective interest rate is the interest rate on a loan restated from the nominal interest rate and it is expressed as the equivalent interest rate when compound interest was payable annually in arrears.

As a result of compounding, the effective annual rate on a bank deposit (or a loan) is always equal to or greater than the nominal rate on the deposit.

Learn more about annual rate on:

brainly.com/question/15728540

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