Western Energy makes quarterly deposits into an account reserved for purchasing new equipment 2 years from now. The interest paid on the deposits is 12% per year, compounded monthly. (a) Identify the interest period, compounding period, and compounding frequency in the interest period. (b) Calculate the effective annual interest rate, that is, the APY.
What will be an ideal response?
(a) Interest period = year; CP = month; m = 12
(b) i n = (1 + r/m) m -1
= (1 + 0.12/12) 12 – 1
= 0.12683 (12.683%)
You might also like to view...
A weight is attached to a horizontal load through a frictionless pulley. The weight has a mass of 25.0 kg, and the acceleration due to gravity is 9.80 m/s2. The weight is allowed to fall 2.35 m. What is the work done by the falling weight as it pulls the load on a horizontal plane?
Given: m = 25.0 kg; g = 9.80 m/s2; ?x = 2.35 m What will be an ideal response?
Which crane base components generally eliminate operational quadrant restrictions?
a. Crawlers b. Ring attachments c. Outriggers/ stabilizers d. Rubber tires
What is the purpose of reducing the trunk duct size in a reducing extended plenum duct system?
What will be an ideal response?
Unbalanced seals have a _____ face loading than balanced seals
a. lower b. higher c. lighter d. more evenly distributed