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Calculate the Annual Percentage Yield (APY) on an account that has a stated interest rate of...

Calculate the Annual Percentage Yield (APY) on an account that has a stated interest rate of 6.21% . Presume your account you deposit 5,875 a year for the next 42 years. Calculate the value of your portfolio when the interest is compounded yearly, quarterly, monthly, and daily.

Solutions

Expert Solution

APY = (1 + (r/n))n - 1

where r = stated interest rate

n = number of compounding periods per year

Future value of portfolio is calculated using FV function in excel :

rate = APY

nper = 42

pmt = -5875

jeff jeffy answered 2 years ago
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