You are looking at acquiring credit from four different institutions and the rates are as follows: ANZ 20% compounded on a daily basis CBA 20% compounded an a weekly basis NAB 20% compounded on a monthly basis ING 20% compounded on a quarterly basis Which bank will you choose?
A) ANZ.
B) NAB.
C) ING.
D) CBA.

Question

Quizplus · Accepted Answer

ING offers the lowest effective annual rate due to the longer compounding period.

You Are Looking at Acquiring Credit from Four Different Institutions