Here's the problem:
What nominal rate compounded monthly has the same Annual Percentage Yield as 7% compounded quarterly?
How would I go about solving this?
i = Annual Nominal Rate to be compounded monthly
The description of 7% is inadequate. Is that 7% quarterly or 7% Nominal Annual to be compounded quarterly? Let's go with the latter and we are nearly done.
j = i/12 = Monthly interest rate
k = 0.07/4 = Quarterly interest rate for 7%
Solve for j
Solve for i.