DSC1630 Assignment 2 Semester 2 2025 (Accurate Solutions) Due 2025

DSC1630
Assignment 2
Semester 2 2025
Due Year 2025

, DSC1630 Assignment 2 — Due: Year 2025




DSC1630 Assignment 2
Due Date: Year 2025


Question 1
Problem Statement: Determine the equivalent weekly compounded interest rate (to
two decimal places) of an interest rate of 14.90% per year, compounded quarterly.

Step 1 — Convert via Effective Annual Rate (EAR)
 4
0.149
EAR = 1 + −1
4

Step 2 — Calculate EAR
0.149
= 0.03725, 1 + 0.03725 = 1.03725
4
(1.03725)4 = 1.1575340 ⇒ EAR = 0.1575340 = 15.75%

Step 3 — Convert to Weekly Nominal Rate

(1 + iw )52 = 1 + EAR = 1.1575340

iw = (1.1575340)1/52 − 1 ≈ 0.0028173 (per week)

j (52) = 52 · iw ≈ 0.146498 = 14.65% p.a.

Final Answer: Equivalent nominal annual rate compounded weekly:

14.65% p.a.

(Weekly effective rate ≈ 0.28% per week.)




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