A bank offers interest rates of 1.40% p.a. for 60-day GICS and 1.95% p.a. for120-day GICS. Leonie was considering the following two investment options atthis bank:Option A: Invest an amount in a 120-day GIC.Option B: Invest an amount in a 60-day GIC then invest the maturity amountin a second 60-day GIC.What interest rate should be offered on the 60-day GIC, 60 days from now, forLeonie to earn the same amount of money from either option?Round to two decimal places

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Answered: A bank offers interest rates of 1.40%…

Advanced Engineering Mathematics

10th Edition

ISBN:9780470458365

Author:Erwin Kreyszig

Publisher:Erwin Kreyszig

Chapter2: Second-order Linear Odes

Section: Chapter Questions

Problem 1RQ

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A bank offers interest rates of 1.40% p.a. for 60-day GICS and 1.95% p.a. for 120-day GICS. Leonie was considering the following two investment options at this bank: