Wednesday 6 June 2012

Northwest Bank pays a quoted annual (nominal) interest rate of 4.75%.

Northwest Bank pays a quoted annual (nominal) interest rate of 4.75%. However, it pays interest (compouned) daily using a 365-day year. What is the effective annual rate of return (APY)?
A.
5.02%
B.
3.61%
C.
4.75%
D.
4.86%
 

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