Homework Help: math

Posted by Anonymous on Friday, October 29, 2010 at 3:42pm.

What is the APY for money invested at each rate? (A) 6% compounded monthly (B) 4% compoumded continuously

math - Henry, Saturday, October 30, 2010 at 11:53pm
APY = (1 + r)^n - 1.
A. r = APR / 365 = rate per compounding
period expressed as a decimal.
n = 365 days=the number of compounding
periods.

APY = (1 + 0.00016438)^365 - 1,
= 1.061830 - 1 = 0.061830 = 6.183%

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