Five banks offer nominal rates of 9% on deposits, but A pays interest annually, B...
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Accounting
Five banks offer nominal rates of 9% on deposits, but A pays interest annually, B pays semiannually, C pays quarterly, D pays monthly, and E pays daily. Assume 365 days in a year.
What effective annual rate does each bank pay? If you deposit $6,000 in each bank today, how much will you have in each bank at the end of 1 year? 2 years? Round your answers to two decimal places.
| A | B | C | D | E | ||||||
| EAR | fill in the blank 35 | % | fill in the blank 36 | % | fill in the blank 37 | % | fill in the blank 38 | % | fill in the blank 39 | % |
| FV after 1 year | $ fill in the blank 40 | $ fill in the blank 41 | $ fill in the blank 42 | $ fill in the blank 43 | $ fill in the blank 44 | |||||
| FV after 2 years | $ fill in the blank 45 | $ fill in the blank 46 | $ fill in the blank 47 | $ fill in the blank 48 | $ fill in the blank 49 | |||||
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