SOLUTION: A bank features a savings account that has an annual percentage rate of 4.6 % with interest compounded quarterly. Dana deposits $8,500 into the account. What is the annual perce

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Question 1166601: A bank features a savings account that has an annual percentage rate of 4.6 % with interest compounded quarterly. Dana deposits $8,500 into the account.
What is the annual percentage yield (APY) for the savings account?
APY = ______%. Round to the nearest hundredth of a percent.

Answer by greenestamps(13198)   (Show Source): You can put this solution on YOUR website!


The annual percentage is 4.6%

The quarterly percentage is 4.6%/4 = 1.15%

The quarterly growth factor is 100%+1.15% = 101.15% = 1.0115

The annual growth factor is (1.0115)^4

Use a calculator and round as directed.


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