Asked by michael makrop on May 26, 2024
Verified
Huong deposits $2,000 into an account that earns 4.2% interest compounded daily.What is the annual percentage yield (APY)to the nearest hundredth of a percent?
Compounded Daily
Describes the method by which interest is calculated on an investment or loan with the earned interest being added to the principal daily for future interest calculations.
Annual Percentage Yield
The real rate of return earned on an investment, taking into account the effect of compounding interest.
- Compute future savings using differing compounding frequency.
- Analyze the impact of various compounding frequencies on investment growth.
Verified Answer
LR
Learning Objectives
- Compute future savings using differing compounding frequency.
- Analyze the impact of various compounding frequencies on investment growth.