SOLUTION: A passbook savings account has a rate of 9%. Find the effective annual​ yield, rounded to the nearest tenth of a​ percent, if the interest is compounded semiannually. The ef

Algebra ->  Finance -> SOLUTION: A passbook savings account has a rate of 9%. Find the effective annual​ yield, rounded to the nearest tenth of a​ percent, if the interest is compounded semiannually. The ef      Log On


   

Question 1175032: A passbook savings account has a rate of 9%. Find the effective annual​ yield, rounded to the nearest tenth of a​ percent, if the interest is compounded semiannually.
The effective annual yield is %
Answer by ikleyn(52781) About Me  (Show Source):
You can put this solution on YOUR website!
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The effective annual growth coefficient is  %281%2B0.09%2F2%29%5E2 = 1.045%5E2 = 1.092025.     


The effective annual yield is  1.092025 - 1 = 0.092025 = 0.092 (rounded) = 9.2% (approximately).     ANSWER

Solved.

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For all details and explanations, look into these two lessons
    - Compounded 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 (!)