1) The effective annual rate of interest corresponding to nominal rate of 6% per annum payable half-yearly is A) 6.06% B) 6.07% C) 6.09% D) 6.11% E) 6.10% Answer: Option CExplanation:Amount of Rs. $100$ for $1$ yrs when $CI$ half yearly $=\left[100\left(1+\frac{3}{100}\right)^{2}\right]$ $=106.09$ $\therefore$ Effective Rate $=106.09-100$ = 6.09 %
