A bank pays 12% per annum on its savings accounts. At the end of every three years, a 2% bonus is paid on the balance at that time. Find the annual effective rate of interest earned by an investor, if the deposit is withdrawn (a) in 2 years, (b) in 3 years, (c) in 4 years.|||a. it is still 12% ... there is no change...
b. (1.12)^3(1.02) = (1+j)^3
(1+j) = 1.1274
thus the annual effective rate of interest is 12.74%
c. (1.12)^4(1.02) = (1+j)^4
(1+j) = 1.12556
thus the annual effective rate of interest is 12.56%
搂|||a) 12%
b) (1.12^3 * 1.02)^(1/3) = 12.74%
c) (1.12^4 * 1.02)^(1/4) = 12.56%
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment