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rate which is divided by compounding periods to calculate periodic rate...

This question belongs to Commerce Financial Management
Financial Management
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rate which is divided by compounding periods to calculate periodic rate must be

Answer & Solution
Correct Answer: Option C
Rate which is divided by compounding periods to calculate periodic rate must be nominal rate. Nominal interest rate refers to the interest rate before taking inflation into account. Nominal can also refer to the advertised or stated interest rate on a loan, without taking into account any fees or compounding of interest.
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