Find the annual percentage yield (APY).
-A bank offers an APR of 2.4% compounded monthly.

Question

Quizplus · Accepted Answer

The APY can be calculated using the formula APY = (1 + r/n)^(n*t) - 1, where r is the annual interest rate (APR), n is the number of compounding periods per year, and t is the time in years. For an APR of 2.4% (or 0.024 as a decimal) compounded monthly (n = 12), for 1 year (t = 1), the APY is calculated as (1 + 0.024/12)^(12*1) - 1 = 0.0243 or 2.43%.

Find the Annual Percentage Yield (APY)