Suppose you deposited $1,000 in a credit union account that pays 7% with daily compounding and a

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Suppose you deposited $1,000 in a credit union account that pays 7% with daily compounding and a 365-day year. What is the EFF%, and how much could you withdraw after seven months, assuming this is seven-twelfths of a year? [EFF% =

(1 + 0.07/365)365 − 1 = 0.07250098 = 7.250098%. Thus, your account would grow from $1,000 to $1,000(1.07250098)0.583333 = $1,041.67, and you could withdraw that amount.]

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