Quantcast

A community for students.

Here's the question you clicked on:

55 members online
  • 0 replying
  • 0 viewing

starrhunter

  • 2 years ago

Please help? George is comparing three investment accounts offering different rates. Account A: APR of 3.75 compounding monthly Account B APR of 3.85 compounding quarterly Account C APR of 3.95 compounding daily Which account will give George at least a 4% annual yield?

  • This Question is Closed
  1. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    you need to compute three numbers \[(1+\frac{.0375}{4})^4\] \[(1+\frac{.0385}{12})^{12}\] \[(1+\frac{.0395}{365})^{365}\]

  2. starrhunter
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 0

    so which ever equals at least "4" will give me the answer then?

  3. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    each will look like \(1+.0somthing\) choose the one or ones with the something greater than or equal to 4

  4. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    none will give you 4 if the answer looks like \(1.04...\) then that is a yield of larger than \(4\%\) if the answer is \(1.03...\) then no

  5. starrhunter
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 0

    wait the first two equations are mixed up am i right?

  6. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    oh yeah my fault, sorry

  7. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    \[(1+\frac{.0375}{12})^{12}\]

  8. starrhunter
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 0

    it's quite alright. I know how to set up the problem now. but about the yeild, the number won't equal 4, but if the last digit in the number is greater than or equal to 4 than that is the answer i would choose?

  9. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    \[(1+\frac{.0385}{4})^{4}\] good catch

  10. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    lets compute one

  11. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    here is the first one http://www.wolframalpha.com/input/?i=%281%2B.0375%2F12%29^12

  12. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    you can see that the answer is \[1.033815...\]

  13. starrhunter
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 0

    so that one can be ruled out

  14. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    so this one is out since it is smaller than \(1.04\)

  15. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    right

  16. starrhunter
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 0

    I'll try the second one..

  17. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    ok you can edit the one i did to compute it if you like

  18. starrhunter
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 0

    is the little 4 on the outside an exponent?

  19. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    yes, that needs to be a 4, and also the denominator under \(.0385\) should be a 4 also

  20. starrhunter
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 0

    1.039 is what it gave me

  21. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    me too

  22. starrhunter
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 0

    it is the last one, it gave me 1.04

  23. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    then i guess that is the one you want

  24. starrhunter
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 0

    thanks for the help

  25. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    you good with this?

  26. satellite73
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 1

    yw

  27. starrhunter
    • 2 years ago
    Best Response
    You've already chosen the best response.
    Medals 0

    yes indeed :3

  28. Not the answer you are looking for?
    Search for more explanations.

    • Attachments:

Ask your own question

Sign Up
Find more explanations on OpenStudy
Privacy Policy

Your question is ready. Sign up for free to start getting answers.

spraguer (Moderator)
5 → View Detailed Profile

is replying to Can someone tell me what button the professor is hitting...

23

  • Teamwork 19 Teammate
  • Problem Solving 19 Hero
  • You have blocked this person.
  • ✔ You're a fan Checking fan status...

Thanks for being so helpful in mathematics. If you are getting quality help, make sure you spread the word about OpenStudy.

This is the testimonial you wrote.
You haven't written a testimonial for Owlfred.