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3 October, 21:24

Justin deposits $8,000 in a one-year CD at 3.1% interest, compounded daily. What is Justin's annual percentage yield (APY) to the nearest hundredth of a percent? (Hint: Find the interest using the compounding formula. Then use the simple interest formula to find the rate, as if the interest you found at first were simple interest.)

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  1. 3 October, 21:43
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    Total = Princ * (1 + rate/365) ^365*1 year

    Total = 8,000 * (1 +.031/365) ^365

    Total = 8,000 * (1.000084931506849315) ^365

    Total = 8,000 * 1.0314841461

    Total = 8,251.87

    rate = (1 +.031/365) ^365 = 1.0314841461 =

    3.14841461
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