Investing
posted by Viktor .
Interest of 12% per year compounded monthly is roughly equivalent to an interest rate of 12.68% per year compunded yearly when using the formula: A=p(1+r/n)^nt
If you solve the problem the two are equal; how can you derive 12.68% compounded yearly from 12% per year compounded monthly?
Respond to this Question
Similar Questions

Engineering Economics
Hi there, I am having some trouble solving this problem, can you give some guidance as to the solution. What is the amount of 10 equal annual deposits that can provide five annual withdrawals, when a first withdrawal of $1000 is made … 
Maths
Get Rich Quick Investments LTD offers 2 investment schemes. Scheme 1: Earn 6.5% interest per year, compounded monthly. Scheme 2: Earn 6.45% interest per year, compounded daily. An investor reasons that Scheme 2 should be the best because … 
Math
you deposit $1000 at 3% per year.what is the balance at the end of one year,and what is the annual yield,if the interest.Please help solve the problem. Simple interest? 
Math
you deposit $1000 at 3% per year.what is the balance at the end of one year,and what is the annual yield,if the interest.Please help solve the problem. Simple interest? 
math
Each year, Cathy invests $1,200 in her account. The account pays an interest rate of 6.3%. The formula to calculate the balance in her account is B =A(1+ r)n+1 A, where r A is the amount invested per year, r is the interest rate, … 
Math
If interest is compounded monthly at 8% per year for 10 years, explain how to find the number of compounding periods and the interest rate per compounding period. 
calculus
the monthly payment that amortizes a loan of A dollars in t yr when the interest rate is r per year, compounded monthly, is given by P=f(A,r,t) = Ar/ 12[1(1+ r/12)^12t ] Find the monthly payment for a home mortgage of 300,000 that … 
math
Suppose that you have $12,500 to invest over a 4 year period. There are two accounts to choose from: 4.5% compounded monthly or 4.3% compounded continuously. a. Write the formula for the first accountâ€™s compound interest for n compounding … 
simple interest and compund interest.
1) What is the final amount when $3000 is invested at 3% per year simple interest for? 
Math
Using the formula. I =Prt ,calculate the simple interest where t=1/n and n is the number of periodd per year for compounding. You have $20,000 and wished to invest it in one of two ways. Option A: You may invest it in a certificate …