For life insurance policies, some of the premium pays for the cost of the insurance, and the remainder goes toward the cash value of the policy and earns interest like a savings account. Consider the following Insurance company options. Company 1: pays 4.1% compounded monthly on the cash value of their policies Company 2: pays 4.11% compounded semiannually on the cash value of their policies What is the APY offered by each company? (Round your answers to the nearest hundredth.) Company 1 Company 2 Which company offers a higher yield? O Company 1 O Company 2
For life insurance policies, some of the premium pays for the cost of the insurance, and the remainder goes toward the cash value of the policy and earns interest like a savings account. Consider the following Insurance company options. Company 1: pays 4.1% compounded monthly on the cash value of their policies Company 2: pays 4.11% compounded semiannually on the cash value of their policies What is the APY offered by each company? (Round your answers to the nearest hundredth.) Company 1 Company 2 Which company offers a higher yield? O Company 1 O Company 2
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 12P
Related questions
Question
For life insurance policies, some of the premium pays for the cost of the insurance, and the remainder goes toward the cash value of the policy and earns interest like a savings account. Consider the following insurance company options.
Company 1: pays 4.1% compounded monthly on the cash value of their policies
Company 2: pays 4.11% compounded semiannually on the cash value of their policies
What is the APY offered by each company? (Round your answers to the nearest hundredth.)
Which company offers a higher yield?
![8.
DETAILS
HARMATHAP12 6.2.028.EP.
MY NOTES
For life insurance policies, some of the premium pays for the cost of the insurance, and the remainder goes toward the cash value of the policy and earns interest like a savings account.
Consider the following insurance company options.
Company 1: pays 4.1% compounded monthly on the cash value of their policies
Company 2: pays 4.11% compounded semiannually on the cash value of their policies
What is the APY offered by each company? (Round your answers to the nearest hundredth.)
Company 1
%
Company 2
%
Which company offers a higher yield?
O Company 1
O Company 2](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F04c10408-5cfd-4d68-aa09-84e3c4534233%2Fa3cfe071-c253-48db-81f6-0cd660ceb22a%2F7r60nze_processed.jpeg&w=3840&q=75)
Transcribed Image Text:8.
DETAILS
HARMATHAP12 6.2.028.EP.
MY NOTES
For life insurance policies, some of the premium pays for the cost of the insurance, and the remainder goes toward the cash value of the policy and earns interest like a savings account.
Consider the following insurance company options.
Company 1: pays 4.1% compounded monthly on the cash value of their policies
Company 2: pays 4.11% compounded semiannually on the cash value of their policies
What is the APY offered by each company? (Round your answers to the nearest hundredth.)
Company 1
%
Company 2
%
Which company offers a higher yield?
O Company 1
O Company 2
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