EXERCISE 4 4. rates: Bank A pays interest on savings account at 4.5% compounded continuously, Bank B pays 4.75% on a savings account compounded monthly and Bank C pays 4.5% on a savings account compounded quarterly. Three banks in a town quote the following nominal interest а. Which bank pays its savers the lowest interest? APR = (1+)" -1 APR = e' - 1 Note, %3D m. %3D b. If you invest €10000 in Bank B, how long should it take to increase by 30%?

EXERCISE 4 4. rates: Bank A pays interest on savings account at 4.5% compounded continuously, Bank B pays 4.75% on a savings account compounded monthly and Bank C pays 4.5% on a savings account compounded quarterly. Three banks in a town quote the following nominal interest а. Which bank pays its savers the lowest interest? APR = (1+)" -1 APR = e' - 1 Note, %3D m. %3D b. If you invest €10000 in Bank B, how long should it take to increase by 30%?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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£ In a bank account that pays interest 8% p.a, what should you deposit now to have a balance of £2,000 a year from now? Enter an answer correct to 2 decimal places.
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