document.write( "Question 120: Ann Watson has $100,000 that she can deposit in any of three savings accounts for a 3-year period. Bank A compounds interest on an annual basis, bank B compounds interest twice each year, and bank C compounds interest each quarter. All three banks have a stated annual interest rate of 4 percent.
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Algebra.Com's Answer #109 by AnlytcPhil(1806)\"\" \"About 
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Ms. Watson has $100,000 that she can deposit in any of three savings accounts
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document.write( "for a 3-year period. Bank A compounds interest on an annual basis, bank B
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document.write( "compounds interest twice each year, and bank C compounds interest each quarter.
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document.write( "All three banks have a stated annual interest rate of 4 percent. a) What amount
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document.write( "would Ms. Watson have at the end of the third year-including interest? b) What
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document.write( "effective interest rate would she earn at each bank? c) On the basis of your
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document.write( "finding in a and b, which bank should Ms. Watson deal with? Why? 
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document.write( "The formula is 
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document.write( "A = P(1 + r/n)^(nt)
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document.write( "A = 100000, r = .04, t = 3
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document.write( "A = 100000(1 + .04/n)^(n*3)
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document.write( "a) What amount would Ms. Watson have at the end of the third year-including interest.
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document.write( "For Bank A, n = 1, 
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document.write( "A = 100000(1 + .04/1)^(1*3) = $112486
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document.write( "For Bank B, n = 2, 
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document.write( "A = 100000(1 + .04/2)^(2*3) = $112616
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document.write( "For Bank C, n = 4, 
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document.write( "A = 100000(1 + .04/4)^(4*3) = $112683
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document.write( "b) What effective interest rate would she earn at each bank?
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document.write( "I = Prt
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document.write( "r = I/(Pt) 
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document.write( "For Bank A, r = 12486/(100000*3) = .04162 or about 4.162%
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document.write( "For Bank B, r = 12616/(100000*3) = .04205 or about 4.205%
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document.write( "For Bank C, r = 12683/(100000*3) = .04228 or about 4.228%
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document.write( "On the basis of your finding in a and b, which bank should Ms. Watson 
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document.write( "deal with? Why?
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document.write( "C, because the effective interest is the greatest.
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document.write( "Edwin\r
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