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You Are Planning to Save Your Christmas Bonuses from Work

Question 303

Multiple Choice

You are planning to save your Christmas bonuses from work and are comparing savings accounts: Account A compounds semi-annually while account B compounds monthly. If both accounts have
The same effective annual rate of interest and you place only the bonuses in the account, you
Should choose ___________.


A) Account A because it has a higher APR.
B) Account B because it has a higher APR.
C) Account B because it is compounded more often.
D) Account A because you will pay less in taxes.
E) Either since you would be indifferent between the two.

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