What is the annual percentage yield (APY) for money invested at the given annual rate? Round results to the nearest
hundredth of a percent.
-6% compounded quarterly
A) 6.14%
B) 6.09%
C) 6.18%
D) 6.00%

Question

What is the annual percentage yield (APY) for money invested at the given annual rate? Round results to the nearest
 hundredth of a percent.
-6% compounded quarterly
A) 6.14%
B) 6.09%
C) 6.18%
D) 6.00%

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 (as a decimal), n is the number of compounding periods per year, and t is the time in years. For a 6% rate compounded quarterly, r = 0.06, n = 4, and t = 1. Plugging these values into the formula gives APY = (1 + 0.06/4)^(4*1) - 1 = 1.0614 - 1 = 0.0614 or 6.14%.

What Is the Annual Percentage Yield (APY) for Money Invested