What is the nominal discount rate convertible 3 times per year which is equivalent to a nominal interest rate of 6% convertible 6 times per year?

• 0.057
• 0.0591
• 0.06
• 0.062
• 0.067

References

Hlynka, Myron. "University of Windsor Old Tests 62-392 Theory of Interest". web2.uwindsor.ca. Retrieved November 23, 2023.

Solution: B

[[math]] (1+.06 / 6)^6=\left(1-d^{(3)} / 3\right)^{-3} \text { so } d^{(3)}=3\left(1-1.01^{-2}\right)=.0591 [[/math]]

References

Hlynka, Myron. "University of Windsor Old Tests 62-392 Theory of Interest". web2.uwindsor.ca. Retrieved November 23, 2023.