SOA Exam FM Sample Question 400
Study guide: Exam FM-2
A ten-year loan of 1000 is repaid by level payments at the end of each month at an annual nominal interest rate of 8%, compounded monthly. The lender invests the repayments at an annual nominal interest rate of 6%, compounded monthly.
Calculate the lender's annual effective yield rate.
- A) 6.8%
- B) 6.9%
- C) 7.0%
- D) 7.1%
- E) 7.2%
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