Question 223534: If a bank pays 4% annual interest, compounded daily, what is the value of $750 deposited after 1 year. Please show steps so I can understand
Answer by Alan3354(69443)   (Show Source):
You can put this solution on YOUR website! If a bank pays 4% annual interest, compounded daily, what is the value of $750 deposited after 1 year. Please show steps so I can understand
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The number of periods, p, is 365, one per day.
Interest rate, r, per period = 0.04/365
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FV = $750*(1 + r)^p
FV = $750*(1 + 0.04/365)^365 = $750*1.040808...
= $780.61
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