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babunello [35]
3 years ago
11

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!HELP PLEASE!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Mathematics
1 answer:
Reptile [31]3 years ago
7 0

Step-by-step explanation:

18% compounded monthly

vs

charges 18% compounded semi-annually.

#1 is worse than #2 because...

Since the nominal rates are the same, the card with the more frequent compounding so it would have the higher effective rat.

Let's compare them!:

(1 + .18/12)^12 = 1.19562 ---> effective rate is 19.562 per annum

(1+.18/2)² = 1.1881

1.1881 has the effective rate of 18.88% per annum

(1 + /17/4)^4 = 1.18114.. --> effective rate is 18.114% per annum

18% monthly is .18 over 12 each month = 0.015/month

so every month multiply by 1.015

total cost = $607.99 * 1.01^number of months

18% semi annual = .18/2 every six months = .09 /half year

so every half year (6 months) multiply by 1.09

total cost = $607.99 * 1.09^ (number of months/6)

17% quarterly = .17/4 every 3 months = .0425 /quarter year

so every quarter year (3 months) multiply by 1.0425

total cost = $607.99 * 1.025^(number of months/3)

HOPE THIS HELPS YOU HAVE A GREAT GREAT GREAT FANTASTIC FRIDAY!

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