assume the interest rate below is an annual interest rate. find the interest rate for an account that is compounded quarterly and monthly.
7.6%

Question

assume the interest rate below is an annual interest rate. find the interest rate for an account that is compounded quarterly and monthly.
7.6%

anonymous · Answer

compound interest formula:

$$A+P(1+\frac{ r }{ n })^{nt}$$
A= amount of $ in account
P= initial amount
r= annual interest rate
n= number of compounds per year
t= time in years

anonymous · Answer

OOPS.
A= P blah blah blah. not plus. that was a typo

anonymous · Answer

so it should actually be $$A=P(1+\frac{ r }{ n })^{nt}$$ sorry about that :)

anonymous · Answer

no worries :3 
but i'm still a little confused how do i use that formula when i only have 7.6?

anonymous · Answer

Yeah... I thought you may have just typed it wrong... because that is not nearly enough information. It doesn't give you anything else to work with?

anonymous · Answer

Maybe you would just divide that rate by 4 and 12 to find them? I'm really not sure what it's asking you...

anonymous · Answer

yeah thats what i thought too. and no nothing else except answer choices. maybe this will help with finding a different method or whatever.
A. 1.4% ; 0.33%(with the bar over the .33)
B. 1.7% ; 0.67% (bar over .67)
C. 1.9% ; 0.63% (bar over. 63)

anonymous · Answer

oh okay i'll try that.

anonymous · Answer

when I divided them by 4 and 12, I got C. So I'd cross your fingers and go with that. :P

anonymous · Answer

yeah i did that too and got the same so thank you very much! :D

anonymous · Answer

yeah no problem! good luck! :)