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Effective Rate of Return of an Investment with Daily Interest

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You are considering an investment with a quoted return of 10% per year. If interest is compounded daily, what is the effective return on this investment?
a. 1.11%
b. 10.00%
c. 10.25%
d. 10.47%
e. 10.52%

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The solution explains how to calculate the effective rate of return.

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