Question

You have a savings account in which you leave the funds for one year without adding to or withdrawing from the account. Which would you rather​ have: a daily compounded rate of ​%, a weekly compounded rate of ​%, a monthly compounded rate of ​%, a quarterly compounded rater of ​%, a semiannually compounded rate of ​%, or an annually compounded rate of ​%? Which periodic rate would you rather have for your savings​ account

Answer 1

Answer:

a weekly compounded rate of 0.355​%

Explanation:

the question is incomplete:

a daily compounded rate of 0.040​%, a weekly compounded rate of 0.355​%, a monthly compounded rate of 1.15​%, a quarterly compounded rater of 4.00​%, a semiannually compounded rate of 7.5% or an annually compounded rate of 14​%

compounded daily:

• effective interest rate = (1 + 0.0004)³⁶⁵ - 1 = 0.157162407

compounded weekly:

• effective interest rate = (1 + 0.00355)⁵² - 1 = 0.202344148

compounded monthly:

• effective interest rate = (1 + 0.0115)¹² - 1 = 0.147071911

compounded quarterly:

• effective interest rate = (1 + 0.04)⁴ - 1 = 0.16985856

compounded semiannually:

• effective interest rate = (1 + 0.075)² - 1 = 0.155625

compounded annually

• effective interest rate = 14%