Which of the following investments has the highest effective annual return (EAR)? (Assume that all CDs are of equal risk.)
A) A bank CD that pays 7.00 percent interest compounded daily.
B) A bank CD that pays 7.10 percent compounded monthly.
C) A bank CD that pays 7.30 percent annually.
D) A bank CD that pays 7.25 percent compounded semiannually.

Question

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The Answer of Which of the following investments has the highest effective annual return (EAR)? (Assume that all CDs are of equal risk.)
A) A bank CD that pays 7.00 percent interest compounded daily.
B) A bank CD that pays 7.10 percent compounded monthly.
C) A bank CD that pays 7.30 percent annually.
D) A bank CD that pays 7.25 percent compounded semiannually.

Which of the Following Investments Has the Highest Effective Annual