1) Suppose that you have $10,000 to invest and the bank offer you the following options:...

1) Suppose that you have $10,000 to invest and the bank offer you the following options:

A: Interest rate of 8.5% compounded quarterly.

B:Interest rate of 8.3% compounded monthly.

C:Interest rate of 822% compounded weekly.

D: Simple interest rate of 15%

a) Order the options from worst to best, if the term of the investment is 1, 3, 10 and 20 years.

b) What is the minimum number of years required for options A, B and C to be more profitable than option D.

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Expert Solution

orchestra answered 11 months ago

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