## anonymous 3 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?

1. anonymous

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

2. anonymous

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

3. anonymous

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

4. anonymous

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. anonymous

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

6. anonymous

oh yeah my fault, sorry

7. anonymous

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

8. anonymous

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. anonymous

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

10. anonymous

lets compute one

11. anonymous

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

12. anonymous

you can see that the answer is $1.033815...$

13. anonymous

so that one can be ruled out

14. anonymous

so this one is out since it is smaller than $$1.04$$

15. anonymous

right

16. anonymous

I'll try the second one..

17. anonymous

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

18. anonymous

is the little 4 on the outside an exponent?

19. anonymous

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

20. anonymous

1.039 is what it gave me

21. anonymous

me too

22. anonymous

it is the last one, it gave me 1.04

23. anonymous

then i guess that is the one you want

24. anonymous

thanks for the help

25. anonymous

you good with this?

26. anonymous

yw

27. anonymous

yes indeed :3