The First National Bank is offering a 4 year certificate of deposit (CD) at 4% interest compounded quarterly; Second National Bank is offering a 4 year CD at 5% interest compounded annually. (Round your answers to two decimal places.) (a) If you were interested in investing $6,000 in one of these CDs, calculate the compound amount (in $) of each offer. (Use Table 11-1.) First National Bank$ Second National Bank$ (b) What is the annual percentage yield of each CD? First National Bank %Second National Bank % (c) If Third National Bank has a 4 year CD at 4.5% interest compounded monthly, use the compound interest formula to calculate the compound amount (in $) of this offer. $ ????????
The First National Bank is offering a 4 year certificate of deposit (CD) at 4% interest compounded quarterly; Second National Bank is offering a 4 year CD at 5% interest compounded annually. (Round your answers to two decimal places.) (a) If you were interested in investing $6,000 in one of these CDs, calculate the compound amount (in $) of each offer. (Use Table 11-1.) First National Bank$ Second National Bank$ (b) What is the annual percentage yield of each CD? First National Bank %Second National Bank % (c) If Third National Bank has a 4 year CD at 4.5% interest compounded monthly, use the compound interest formula to calculate the compound amount (in $) of this offer. $ ????????
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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The First National Bank is offering a 4 year certificate of deposit (CD) at 4% interest compounded quarterly; Second National Bank is offering a 4 year CD at 5% interest compounded annually. (Round your answers to two decimal places.)
(a)
If you were interested in investing $6,000 in one of these CDs, calculate the compound amount (in $) of each offer. (Use Table 11-1.)
First National Bank$ Second National Bank$
(b)
What is the annual percentage yield of each CD?
First National Bank %Second National Bank %
(c)
If Third National Bank has a 4 year CD at 4.5% interest compounded monthly, use the compound interest formula to calculate the compound amount (in $) of this offer.
$ ????????
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