Find the total number of compounding periods and the interest rate per period for the investment.
Term of
Investment	Nominal
(Annual) Rate (%)	Interest
Compounded	Compounding
Periods	Rate per
Period (%)
5 years	3	monthly	 	  %

To find the **total number of compounding periods** and the **interest rate per period**, we'll break down the information provided:

- **Nominal (Annual) Rate** = 3% per year
- **Compounding Frequency** = Monthly
- **Term of Investment** = 5 years

### 1. **Total Number of Compounding Periods:**
Since the interest is compounded monthly, the number of compounding periods in a year is 12.

\[
\text{Total Number of Compounding Periods} = \text{Number of Years} \times \text{Number of Compounding Periods per Year}
\]

\[
\text{Total Number of Compounding Periods} = 5 \times 12 = 60
\]

So, there are **60 compounding periods**.

### 2. **Interest Rate per Period:**
The annual nominal rate is 3%, but since the interest is compounded monthly, we need to divide this annual rate by the number of periods in a year (12 months).

\[
\text{Interest Rate per Period} = \frac{\text{Annual Rate}}{\text{Number of Periods per Year}} = \frac{3}{12} = 0.25\%
\]

So, the **interest rate per period** is **0.25%**.

### Final Answer:
- **Total Number of Compounding Periods** = 60
- **Interest Rate per Period** = 0.25%

Would you like further details or have any questions?

Here are 5 related questions you could explore:
1. How does changing the compounding frequency affect the final amount?
2. How do you calculate the future value of an investment with monthly compounding?
3. What is the difference between nominal and effective interest rates?
4. How would daily compounding change the total number of periods and rate per period?
5. How can you calculate the present value of an investment with compound interest?

**Tip:** The more frequently interest is compounded, the more quickly the investment grows, even if the nominal rate stays the same.

Find the total number of compounding periods and the interest rate per period for the investment. Term of Investment: 5 years, Nominal (Annual) Rate: 3%, Interest Compounded: Monthly.

Discover how to calculate the total number of compounding periods and the interest rate per period for an investment with a 5-year term, a 3% annual nominal rate, and monthly compounding. This solution includes step-by-step formulas and explanations, suitable for students in Grades 9-12.

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