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CHAPTER 4
Applied Finance and Economics
Part IV Foundations and Applications of the Time Value of Money: Yielding for Yields

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Learning Objectives

■ Describe annual percentage rate (APR).

■ Solve problems converting different rates and compounding periods into APR.

■ Describe effective annual rate (EAR).

■ Solve problems by calculating the EAR.

■ Solve for the unknown interest rate (i).

■ Solve for the time-weighted return and money-weighted return.

■ Explain the Rule of 72 and the Rule of 69 and apply either to solve problems.

The Investment Advisor Body of Knowledge + Test Bank

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