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philliesgirl23
Group Title
Bob opened a credit card at a department store with an APR of 23.99% compounded monthly. What is the APY on this credit card?
26.81%
2.00%
47.98%
32.91%
 one year ago
 one year ago
philliesgirl23 Group Title
Bob opened a credit card at a department store with an APR of 23.99% compounded monthly. What is the APY on this credit card? 26.81% 2.00% 47.98% 32.91%
 one year ago
 one year ago

This Question is Closed

mathmate Group TitleBest ResponseYou've already chosen the best response.1
Without calculations, it seems to me that 26.81 is the right answer, because APY is usually a little higher than APR. Let's check: For a year, there are 12 compoundings, and each time the rate of interest is 23.99%/12 So APY=(1+0.2399/12)^121 = 0.2681 yay!
 one year ago
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