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Determine the effective annual yield (annual percentage yield) for $1
invested for 1 year at 8.5% compounded monthly.

  • Maths -

    let that rate be i

    (1+i)^1 = (1+.085/12)^12
    1+i = 1.08839
    i = .08839

    so the effective annual rate is 8.839%

  • Maths -

    Thanks a lot

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