Question

In: Finance

Which do you​ prefer: a bank account that pays 6 %per year​ (EAR) for three years...

Which do you​ prefer: a bank account that pays 6 %per year​ (EAR) for three years or

a. An account that pays 3 % every six months for three​ years?                        

b. An account that pays 9 % every 18 months for three​ years?                           

c. An account that pays 0.6 % per month for three​ years?

a. An account that pays 3 % every six months for three​ years?                        

If you deposit $1 into a bank account that pays 6 % per year for three​ years, you will have $____ (Round to five decimal​ places.)

Solutions

Expert Solution

Calculations-

Please upvote if the ans is helpful.In case of doubt,do comment.Thanks.


Related Solutions

Which do you​ prefer: a bank account that pays 4.8% per year​ (EAR) for three years...
Which do you​ prefer: a bank account that pays 4.8% per year​ (EAR) for three years or a. An account that pays 2.6% every six months for three​ years?                    b. An account that pays 7.4% every 18 months for three​ years?                    c. An account that pays 0.41% per month for three​ years? ​(Note: Compare your current bank EAR with each of the three alternative accounts. Be careful not to round any intermediate steps less than six decimal​ places.)   
Which do you prefer, a bank account that pays 10% per year (EAR) for three years...
Which do you prefer, a bank account that pays 10% per year (EAR) for three years or a. An account that pays 5% every six months for three years b. B. an account that pays 15% every 18 months for three years? c. An account that pays 1% per month for three years? If you deposit $1 into a bank account that pays 10% per year for three years, you will have $____ Therefore you would prefer _______________ If the...
Which do you prefer: a bank account that pays 5.1% per year (EAR) for three years...
Which do you prefer: a bank account that pays 5.1% per year (EAR) for three years or a. An account that pays 2.8% every six months for three years? b. An account that pays 8.3% every 18 months for three years? c, An account that pays .67% every per months for three years? (Note: Compare your current bank EAR with each of the three alternative accounts. Be careful not to round any intermediate steps less than six decimal places.) If...
which do you prefer: a bank account that pays 5.8% per year (EAR) for three years...
which do you prefer: a bank account that pays 5.8% per year (EAR) for three years or (a) An account that pays 2.7% every six months for three years? (b) An account that pays 7.2% every 18 months for three years (c) An account that pays 0.49% per month for three years
Which do you? prefer: a bank account that pays 4.8 % per year? (EAR) for three...
Which do you? prefer: a bank account that pays 4.8 % per year? (EAR) for three years or a. An account that pays 2.6 % every six months for three? years? b. An account that pays 6.8 % every 18 months for three? years? c. An account that pays 0.58 % per month for three? years?
Which do you​ prefer: a bank account that pays 5.2 % per year​ (EAR) for three...
Which do you​ prefer: a bank account that pays 5.2 % per year​ (EAR) for three years or a. An account that pays 2.8 % every six months for three​ years? b. An account that pays 7.5 % every 18 months for three​ years? c. An account that pays 0.26 % per month for three​ years? ​(Note: Compare your current bank EAR with each of the three alternative accounts. Be careful not to round any intermediate steps less than six...
Which do you​ prefer: a bank account that pays 5.1 % per year​ (EAR) for three...
Which do you​ prefer: a bank account that pays 5.1 % per year​ (EAR) for three years or A. An account that pays 2.8 % every six months for three​ years? B. An account that pays 6.8 % every 18 months for three​ years? C. An account that pays 0.65 % per month for three​ years? ​ (Note: Compare your current bank EAR with each of the three alternative accounts. Be careful not to round any intermediate steps less than...
13.Suppose you deposit $5,000 into your bank account today. If the bank pays 3.75percent per year,...
13.Suppose you deposit $5,000 into your bank account today. If the bank pays 3.75percent per year, then which of the following statements is (are) correct? (x)$7,825.14is in your account after 12years if interest is compounded quarterly but only $7,777.27if the interest is compounded annually.(y)You will earn an additional $31.69of interest in your account after 12years if interest is compounded semi-annually instead of annually, but $27.10less interest if interest is compounded semi-annually instead of monthly.(z)Although compounding daily instead of weekly will...
If you earn 6% per year on your bank account, how long will it take an...
If you earn 6% per year on your bank account, how long will it take an account with $110 to double to $220? A famous quarterback just signed a contract for $19.5 million, providing $3.9 million a year for 5 years. A less famous receiver signed a contract for $18.5 million, providing $4 million now and $2.9 million a year for 5 years. The interest rate is 10%. a. What is the PV of the quarterback's contract? (Do not round...
You decide to open a retirement account at your local bank that pays 8%/year/month (8% per...
You decide to open a retirement account at your local bank that pays 8%/year/month (8% per year compounded monthly). For the next 20 years, you will deposit $500 per month into the account, with all deposits and withdrawals occurring at month’s end. On the day of the last deposit, you will retire. Your expenses during the first year of retirement will be covered by your company’s retirement plan. As such, your first withdrawal from your retirement account will occur on...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT