two options: Option A: 3.725% compounded semiannually Option B: 3.675% compounded continuously. (a) Calculate the annual percentage yield for each option. (Round your answers to three decimal places.) Option A Option B Which is the better option? O Option A O Option B (b) Calculate the future value of each investment after 2 years and after 5 years. (Round your answers to two decimal places.) Option A Option B Years 2 5 % % $ $ Does your choice of option depend on the number of years you leave the money invested? O Yes O No
two options: Option A: 3.725% compounded semiannually Option B: 3.675% compounded continuously. (a) Calculate the annual percentage yield for each option. (Round your answers to three decimal places.) Option A Option B Which is the better option? O Option A O Option B (b) Calculate the future value of each investment after 2 years and after 5 years. (Round your answers to two decimal places.) Option A Option B Years 2 5 % % $ $ Does your choice of option depend on the number of years you leave the money invested? O Yes O No
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:You have $3000 to invest, and you have two options:
Option A: 3.725% compounded semiannually
Option B: 3.675% compounded continuously.
(a) Calculate the annual percentage yield for each option. (Round your answers to three decimal places.)
Option A
Option B
Which is the better option?
O Option A
O Option B
(b) Calculate the future value of each investment after 2 years and after 5 years. (Round your answers to two decimal places.)
Option A
Option B
Years
2
%
%
5
$
$
$
Does your choice of option depend on the number of years you leave the money invested?
O Yes
O No
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