The Continental Bank advertises capital savings at 7.9% compounded annually while TD Canada Trust offer premium savings at 7.75% compounded monthly. Suppose you have $2500 to invest for two years. (a) Which deposit will earn more interest? (b) What is the difference in the amount of interest? (a) The TD Canada Trust savings account will earn more interest. (b) The difference is $ (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places needed.)

The Continental Bank advertises capital savings at 7.9% compounded annually while TD Canada Trust offer premium savings at 7.75% compounded monthly. Suppose you have $2500 to invest for two years. (a) Which deposit will earn more interest? (b) What is the difference in the amount of interest? (a) The TD Canada Trust savings account will earn more interest. (b) The difference is $ (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places needed.)

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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A bank is currently offering a savings account paying an interest rate of 6.0 percent compounded quarterly. It would like to offer another account ,with the same effective annual rate ,but compounded monthly. What is the equivalent rate of compound monthly.?
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You deposit $1.000 one year, $2000 next year and withdraw $1000 other year starting year I until year 30 with an interest rate of 5% one year., 6% next year, and 7% other year. How much money will you have at the end of year thirty if there are different interest rates as shown in the diagram belowe 1000 1000 1000 1000 26 28 29 30 2. 7% 5% 6% 7% 6% 7% S% 6% F? 1000 2000 1000 2000 2000 1000 2000 Select one: O a. 55698 O b. 45000 O c. 72333 O d. 56187 O e. 47566
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