SOLUTION: find the annual percentage yield if a bank offers an APR of 3.2% compounded monthly.
I am trying to help my daughter with her homework and I feel really silly because I cannot do
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Question 1167060: find the annual percentage yield if a bank offers an APR of 3.2% compounded monthly.
I am trying to help my daughter with her homework and I feel really silly because I cannot do this. Thank you
Found 3 solutions by Boreal, math_helper, ikleyn:
Answer by Boreal(15235) (Show Source): You can put this solution on YOUR website!
it's easy to confuse the two, and while the differences may be small, they can be significant.
the rate per month is (0.032/12)=0.00266667
add 1 to get 1.00266667
raise it to the 12th power (the "^" after the number.)
1.00266667^12=1.03247
subtract 1
0.03247 or 3.25% rounded.
Answer by math_helper(2461) (Show Source): You can put this solution on YOUR website!
APY =
where
n = number of periods
r = periodic rate (here, it is 3.2%/12 = 0.032/12 = 0.0026667)
APY = = 0.03247 or 3.25% to two decimal places.
Answer by ikleyn(52781) (Show Source): You can put this solution on YOUR website!
.
In this site, there are two lessons that cover all similar problems and contain all details and explanations
- Compound interest percentage problems
- Problems on discretely compound accounts
in this site, and learn the subject from there.
After reading these lessons, you will tackle such problems on your own without asking for help from outside.
Also, you have this free of charge online textbook in ALGEBRA-I in this site
- ALGEBRA-I - YOUR ONLINE TEXTBOOK.
The referred lessons are the part of this online textbook under the topic "Logarithms".
Save the link to this online textbook together with its description
Free of charge online textbook in ALGEBRA-I
https://www.algebra.com/algebra/homework/quadratic/lessons/ALGEBRA-I-YOUR-ONLINE-TEXTBOOK.lesson
to your archive and use it when it is needed.
Happy learning (!)
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