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Question: 248c...

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2.48(c)
2.4 8 You have $50 000 to invest in the stock market and have sought the expertise of Adam, an experienced colleague who is willing to advise you, for a fee. Adam informs you he has found a one-year investment that provides 15 percent interest, compounded monthly (a) What is the effective annual interest rate based on a 15 percent nominal annual rate and monthly compounding? (b) Adam says he will make the investment for a modest fee of 2 percent of the investments value one year from now. If you invest the $50 000 today, how much will you have at the end of one year (before Adams fee)? (c) What is the effective annual interest rate of this investment, including Adams fee?
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