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    1 ## DESCRIPTION
    2 ##  Financial mathematics: Effective and nominal rates of interest
    3 ## ENDDESCRIPTION
    4 
    5 ## KEYWORDS('financial mathematics', 'effective and nominal rates')
    6 ## JJH tagged this problem.
    7 
    8 ## DBsubject('Financial Mathematics')
    9 ## DBchapter('Introduction to Interest')
   10 ## DBsection('Effective and Nominal Rates of Interest')
   11 ## Date('5/22/2005')
   12 ## Author('Jeff Holt')
   13 ## Institution('UVA')
   14 ## TitleText1('Financial Mathematics')
   15 ## EditionText1('1')
   16 ## AuthorText1('Holt')
   17 ## Section1('1.3')
   18 ## Problem1()
   19 
   20 DOCUMENT();
   21 
   22 loadMacros(
   23 "PG.pl",
   24 "PGbasicmacros.pl",
   25 "PGchoicemacros.pl",
   26 "PGanswermacros.pl",
   27 "PGauxiliaryFunctions.pl"
   28 );
   29 
   30 TEXT(beginproblem());
   31 $showPartialCorrectAnswers = 1;
   32 
   33 $a = random(6000,8000,100);
   34 $ip = random(5.0,9.7,0.1);
   35 $i = $ip*0.01;
   36 
   37 TEXT(EV2(<<EOT));
   38 
   39 An investment pays $ip percent nominal interest convertible
   40 semiannually.  What is the equivalent nominal rate of interest convertible
   41 monthly?
   42 
   43 $BR
   44 $PAR
   45 Answer =  \{ans_rule(35) \} percent.
   46 $BR
   47 $BR
   48 
   49 EOT
   50 
   51 $ans = 100*((1 + $i/2)**(1/6) - 1)*12;
   52 ANS(num_cmp($ans, format => '%0.3f', tol => .001));
   53 
   54 ENDDOCUMENT();