Question

Find the APY of an investment earning an annual interest rate of 2.188% compounded monthly

Answer 1

APY is given by the following formula:\[APY=\left(1+\frac{r}{n}\right)^n - 1,\]
where r is the annual rate and m is the number of times r is compounded per year.
In this case, r = 0.02188 and m = 12 (since r is compounded monthly).

Answer 2

do you mean n, not m?

Answer 3

Yes, sorry.

Answer 4

thank you!