Which do you prefer: a bank account that pays 5.3% per year (EAR) for three years or a. An account that pays 2.9% every six months for three years? b. An account that pays 7.8% every 18 months for three years? c. An account that pays 0.35% per month for three years? (Note: Compare your current bank EAR with each of the three alternative accounts. Be careful not to round any intermediate steps less than six decimal places.) If you deposit $1 into a bank account that pays 5.3% per year for three years: The amount you will receive after three years is $_______ (Round to five decimal places.) Part 2 a. An account that pays 2.9% every six months for 3 years? If you deposit $1 into a bank account that pays 2.9% every six months for three years: The amount you will receive after three years is $______(Round to five decimal places.) Part 3 Which bank account would you prefer? ▼ 5.3% per year for three years 2.9 % every six months for three years . (Select from the drop-down menu.) Part 4 b. An account that pays 7.8% every 18 months for 3 years? If you deposit $1 into a bank account that pays 7.8% every 18 months for three years: The amount you will receive after three years is $_____ (Round to five decimal places.) Part 5 Which bank account would you prefer? ▼ 5.3% per year for three years 7.8% every 18 months for three years . (Select from the drop-down menu.) Part 6 c. An account that pays 0.35% per month for three years? If you deposit $1 into a bank account that pays 0.35% per month for three years The amount you will receive after three years is $_______ (Round to five decimal places.) Part 7 Which bank account would you prefer? ▼ 5.3 % per year for three years 0.35% every month for three years . (Select from the drop
Which do you prefer: a bank account that pays 5.3% per year (EAR) for three years or a. An account that pays 2.9% every six months for three years? b. An account that pays 7.8% every 18 months for three years? c. An account that pays 0.35% per month for three years? (Note: Compare your current bank EAR with each of the three alternative accounts. Be careful not to round any intermediate steps less than six decimal places.) If you deposit $1 into a bank account that pays 5.3% per year for three years: The amount you will receive after three years is $_______ (Round to five decimal places.) Part 2 a. An account that pays 2.9% every six months for 3 years? If you deposit $1 into a bank account that pays 2.9% every six months for three years: The amount you will receive after three years is $______(Round to five decimal places.) Part 3 Which bank account would you prefer? ▼ 5.3% per year for three years 2.9 % every six months for three years . (Select from the drop-down menu.) Part 4 b. An account that pays 7.8% every 18 months for 3 years? If you deposit $1 into a bank account that pays 7.8% every 18 months for three years: The amount you will receive after three years is $_____ (Round to five decimal places.) Part 5 Which bank account would you prefer? ▼ 5.3% per year for three years 7.8% every 18 months for three years . (Select from the drop-down menu.) Part 6 c. An account that pays 0.35% per month for three years? If you deposit $1 into a bank account that pays 0.35% per month for three years The amount you will receive after three years is $_______ (Round to five decimal places.) Part 7 Which bank account would you prefer? ▼ 5.3 % per year for three years 0.35% every month for three years . (Select from the drop
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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Question
Which do you prefer: a bank account that pays 5.3% per year (EAR) for three years or
a. An account that pays 2.9% every six months for three years?
b. An account that pays 7.8% every 18 months for three years?
c. An account that pays 0.35% per month for three years?
(Note: Compare your current bank EAR with each of the three alternative accounts. Be careful not to round any intermediate steps less than six decimal places.)
If you deposit $1 into a bank account that pays 5.3% per year for three years:
The amount you will receive after three years is $_______ (Round to five decimal places.)
Part 2
a. An account that pays 2.9% every six months for 3 years?
If you deposit $1 into a bank account that pays 2.9% every six months for three years:
The amount you will receive after three years is $______(Round to five decimal places.)
Part 3
Which bank account would you prefer?
▼
5.3% per year for three years
2.9 % every six months for three years
. (Select from the drop-down menu.)
Part 4
b. An account that pays 7.8% every 18 months for 3 years?
If you deposit $1 into a bank account that pays 7.8% every 18 months for three years:
The amount you will receive after three years is $_____ (Round to five decimal places.)
Part 5
Which bank account would you prefer?
▼
5.3% per year for three years
7.8% every 18 months for three years
. (Select from the drop-down menu.)
Part 6
c. An account that pays 0.35% per month for three years?
If you deposit $1 into a bank account that pays 0.35% per month for three years
The amount you will receive after three years is $_______ (Round to five decimal places.)
Part 7
Which bank account would you prefer?
▼
5.3 % per year for three years
0.35% every month for three years
. (Select from the drop-down menu.)
Transcribed Image Text:Which do you prefer: a bank account that pays 5.3% per year (EAR) for three years or
a. An account that pays 2.9% every six months for three years?
b. An account that pays 7.8% every 18 months for three years?
c. An account that pays 0.35% per month for three years?
(Note: Compare your current bank EAR with each of the three alternative accounts. Be careful not to round any intermediate steps less than six decimal places.)
If you deposit $1 into a bank account that pays 5.3% per year for three years:
The amount you will receive after three years is $
(Round to five decimal places.)
a. An account that pays 2.9% every six months for 3 years?
If you deposit $1 into a bank account that pays 2.9% every six months for three years:
The amount you will receive after three years is $ (Round to five decimal places.)
Which bank account would you prefer?
(Select from the drop-down menu.)
b. An account that pays 7.8% every 18 months for 3 years?
If you deposit $1 into a bank account that pays 7.8% every 18 months for three years:
The amount you will receive after three years is $
(Round to five decimal places.
Which bank account would you prefer?
(Select from the drop-down menu.)
c. An account that pays 0.35% per month for three years?
If you deposit $1 into a bank account that pays 0.35% per month for three years
The amount you will receive after three years is
(Round to five decimal places.)
Which bank account would you prefer?
(Select from the drop-down menu.)
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