Answered

At Westonci.ca, we make it easy to get the answers you need from a community of informed and experienced contributors. Explore our Q&A platform to find reliable answers from a wide range of experts in different fields. Discover in-depth answers to your questions from a wide network of professionals on our user-friendly Q&A platform.

You want to invest $25,000 and are looking for safe investment options. Your bank is offering you a certificate of deposit that pays a nominal rate of 4% that is compounded bimonthly (every two months). What is the effective rate of return that you will earn from this investment

Sagot :

jieagilm27

Answer: HI there I think that I can help you!!!

6.14%

Explanation: Here is how I did it :)

The offered investment has a nominal rate (N) of 6% compounded quarterly (n=4 times a year). The effective rate of return (R) is obtained by:

The effective rate of return that you will earn from this investment is 6.14%.

*Note that the amount invested is not relevant when determining the effective rate of return, which means that the rate would be the same for any amount.

Thank you for choosing our service. We're dedicated to providing the best answers for all your questions. Visit us again. We hope you found this helpful. Feel free to come back anytime for more accurate answers and updated information. We're glad you visited Westonci.ca. Return anytime for updated answers from our knowledgeable team.