The effective annual rate of interest corresponding to C.I. at the rate of 16% per annum payable half yearly is:

34.56% 16.64% 08.64% 16.00%

16.64%

Rate of interest half yearly =  \(\frac{16}{2}\)% = 8% Effective rate = x% +y% + \(\frac{xy}{100}\)%  = 8% + 8% + \(\frac{8×8}{100}\)%  ⇒ 16% + \(\frac{64}{100}\)% = 16 + 0.64% = 16.64%