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An online bank is offering to pay 0.15% interest per month on deposits. Your local bank offers to pay 0.70% interest quarterly? (every 3 months).
An online bank is offering to pay 0.15% interest per month on deposits. Your local bank offers to pay 0.70% interest quarterly? (every 3 months). Which is the higher interest rate?
The EAR for the online bank is 0.8149% and the EAR for the local bank is 1.8295%. Therefore, the offer of 0.70% per quarter is higher.
The EAR for the online bank is 1.8149% and the EAR for the local bank is 2.8295%. Therefore, the offer of 0.70% per quarter is higher.
The EAR for the online bank is 2.8295% and the EAR for the local bank is 1.8149%. Therefore, the offer of 0.15% per month is higher.
The EAR for the online bank is 3.8295% and the EAR for the local bank is 2.8149%. Therefore, the offer of 0.15% per month is higher.
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Entrepreneurial Finance
Authors: M. J. Alhabeeb
1st Edition
1118691512, 978-1118691519
