document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=1138049>Question 1138049</A>: <I><SPAN STYLE=\"word-break: break-all;\"> Katrina wants to buy a CD for $1000 that earns 2.5% APR and is compounded quarterly. The CD matures in 5 years. Assume that if funds are withdrawn before the CD matures, the early withdrawal fee is 3 months' interest. What is the early withdrawal fee </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #755957 by </B><A HREF=/tutors/aboutme.mpl?userid=Theo><B>Theo(13342)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=Theo><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=Theo><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=755957\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> the withdrawal pentlties for different banks are different.\r<BR>\n" );
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document.write( "this makes it difficult to answer your question.\r<BR>\n" );
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document.write( "here's a reference.\r<BR>\n" );
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document.write( "<a  rel=nofollow HREF= \"https://www.fool.com/knowledge-center/how-to-calculate-the-penalty-on-an-early-withdrawa.aspx\" target = \"_blank\">https://www.fool.com/knowledge-center/how-to-calculate-the-penalty-on-an-early-withdrawa.aspx</a>\r<BR>\n" );
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document.write( "if the early withdrawl penalty is 3 months interest, and if the penalty is applied to the original value of the CD, then i would think the penalty would be equal to .00625 * 1000 = 6.25 dollars.\r<BR>\n" );
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document.write( "that, however, is highly dependent on the policy of the bank from where you bought the CD, as explained in the reference.\r<BR>\n" );
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document.write( "the interest rate of .00625 was calculated as follows:\r<BR>\n" );
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document.write( "2.5 percent interest rate per year / 100 = .025 interest rate per year / 4 = .00625 interest rate per quarter of a year.\r<BR>\n" );
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