Periodic interest rates. You have a savings account in which you leave the funds for one year without adding to or withdrawing from the account. Which would you rather have: a daily compounded rate of 0.050%, a weekly compounded rate of 0.265%, a monthly compounded rate of 1.35%, a quarterly compounded rater of 3.50%, a semiannually compounded rate of 7%, or an annually compounded rate of 14%? What is the effective annual rate (EAR) of a daily compounded rate of 0.050%? 20.02 % (Round to two decimal places.) What is the EAR of a weekly compounded rate of 0.265%? 14.75 % (Round to two decimal places.) What is the EAR of a monthly compounded rate of 1.35%? % (Round to two decimal places.) Question Viewer
Periodic interest rates. You have a savings account in which you leave the funds for one year without adding to or withdrawing from the account. Which would you rather have: a daily compounded rate of 0.050%, a weekly compounded rate of 0.265%, a monthly compounded rate of 1.35%, a quarterly compounded rater of 3.50%, a semiannually compounded rate of 7%, or an annually compounded rate of 14%? What is the effective annual rate (EAR) of a daily compounded rate of 0.050%? 20.02 % (Round to two decimal places.) What is the EAR of a weekly compounded rate of 0.265%? 14.75 % (Round to two decimal places.) What is the EAR of a monthly compounded rate of 1.35%? % (Round to two decimal places.) Question Viewer
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Periodic interest rates. You have a savings account in which you leave the funds for one year without adding to or withdrawing from the account. Which would you rather have: a daily compounded rate of 0.050%, a weekly
compounded rate of 0.265%, a monthly compounded rate of 1.35%, a quarterly compounded rater of 3.50%, a semiannually compounded rate of 7%, or an annually compounded rate of 14%?
What is the effective annual rate (EAR) of a daily compounded rate of 0.050%?
20.02 % (Round to two decimal places.)
What is the EAR of a weekly compounded rate of 0.265%?
14 75 % (Round to two decimal places.)
What is the EAR of a monthly compounded rate of 1.35%?
% (Round to two decimal places.)
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