To compare interest rates offered by various ﬁnancial institutions, you should compare the:

Question

Quizplus · Accepted Answer

The effective annual rate takes into account the compounding of interest over time and is therefore the most accurate way to compare interest rates offered by various financial institutions. Quoted rates, stated annual rates, and nominal rates do not take into account compounding and may be misleading, while annual percentage rates (APRs) may not include all fees and charges associated with the loan or investment.

To Compare Interest Rates Offered by Various ﬁNancial Institutions, You