document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=47662>Question 47662</A>This question is from textbook <A HREF=http://www.amazon.com/exec/obidos/ASIN/0534373526/algebrahomeworkh>College Algebra</A><BR>\n" );
document.write( ": <I><SPAN STYLE=\"word-break: break-all;\"> Which of the given interest rates and compounding periods would provide the better investment?<BR>\n" );
document.write( "(a) 9 1/4% per year, compounded semiannually<BR>\n" );
document.write( "(b) 9% per year, compounded continously\r<BR>\n" );
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document.write( "Thank you </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #31481 by </B><A HREF=/tutors/aboutme.mpl?userid=venugopalramana><B>venugopalramana(3286)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=venugopalramana><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.geocities.com/venugopalramana/FREE_MATHS_ASSISTANCE.html valign=middle><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=31481\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> Which of the given interest rates and compounding periods would provide the better investment?<BR>\n" );
document.write( "FORMULA IS <BR>\n" );
document.write( "A=P{1+R/100N}^NT<BR>\n" );
document.write( "(a) 9 1/4% per year, compounded semiannually<BR>\n" );
document.write( "R=9.25....T=??..TAKEN AS 1 YEAR...N=2<BR>\n" );
document.write( "A=P(1+9.25/200)^2=1.09464P<BR>\n" );
document.write( "(b) 9% per year, compounded continously <BR>\n" );
document.write( "R=9........T=1......N=TENDS TO INFINITY<BR>\n" );
document.write( "A=P(1+9/100N)^N...LIMIT N TENDING TO INFINITY..<BR>\n" );
document.write( "=P(1+1/X)^X}^9/100.....WHERE X=100N/9<BR>\n" );
document.write( "=P(E)^(9/100)=1.09417<BR>\n" );
document.write( "HENCE 9 1/4% AT 6 MONTHS COMPOUNDING GIVES HIGHER RETURN </SPAN>\n" );
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