Suppose that you have $4,000 to invest. Which investment yields the greater return over a 10 year period: 8.03% compounded dai

Question

2 years ago

9

Suppose that you have $4,000 to invest. Which investment yields the greater return over a 10 year period: 8.03% compounded dai

ly or 8.1% compounded quarterly? Find the total amount of the investment after 10 years if $4,000 is invested at 8.03% compounded daily.

Mathematics

1 answer:

iragen [17] · Answer 1 · 2022-11-12T14:01:03+03:00

iragen [17]2 years ago

5 0

A = 5000(1+.0743/365)365(10)
= 5000(1.000203562)3650 = $10,510.38

A = 5000(1+.075/4)4(10)
= 5000(1.01875)40 = $10,511.75

As you can see these are practically equal, but the 7.5% quarterly is more.

Suppose that you have ​$4,000 to invest. Which investment yields the greater return over a 10 year​ period: 8.03% compounded dai

Suppose that you have $4,000 to invest. Which investment yields the greater return over a 10 year period: 8.03% compounded dai