posted by Beth .
Mabel has $35,000 to invest in a certificate of deposit for 4 years. The certificate of deposit earns interest at 4.75% compounded daily. What is the annual percentage yield to the nearest thousandth of a percent?
All we need is the 4.75% per annum compounded daily
Let the equivalent annual rate be i
1+i = (1 + .0475/365)^365
1+i = 1.0486429...
So the annual rate is 4.864 %