The rate used in compounding is found by taking the annual rate divided by the number of times compounded per day.
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Q14: Effective rates can be seen in the
Q15: The annual rate a bank advertises is
Q16: Annual means compounded once a year.
Q17: Compound value = $ amount divided by
Q18: Interest = principal × rate divided by
Q20: Using the table in the handbook, the
Q21: $100,000 for 20 years compounded at 4%
Q22: Using the interest for daily compounding (in
Q23: The interest on $6,000 at 6% compounded
Q24: Effective rate (APY)is:
A)Never related to compound table
B)Interest
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