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Question : Your bank account pays a 6% nominal rate of interest.

Your bank account pays a 6% nominal rate of interest. The interest is compounded quarterly. Which of the following statements is correct?

The periodic rate of interest is 1.5% and the effective rate of interest is 3%.

The periodic rate of interest is 6% and the effective rate of interest is greater than 6%.

The periodic rate of interest is 1.5% and the effective rate of interest is greater than 6%.

The periodic rate of interest is 3% and the effective rate of interest is 6%.

The periodic rate of interest is 6% and the effective rate of interest is also 6%.