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Bank A advertises a money market account that pays 1 . 6 % compounded quarterly. Bank B advertises a money market account that pays 1
Bank A advertises a money market account that pays compounded quarterly. Bank B advertises a money market account that pays compounded daily.
a Determine the annual percentage yield for bank As money market account.
b Determine the annual percentage yield for bank Bs money market account.
c Assuming all other factors are equal, which bank's money market account would be the better investment?
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Part
a The annual percentage yield for the bank A money market account is
enter your response here
Round to two decimal places as needed.
Part
b The annual percentage yield for the bank B money market account is
enter your response here
Round to two decimal places as needed.
Part
c Which banks money market account would be the better investment? Choose the correct answer below.
A
Bank Upper AAs money market account is the better investment because the annual percentage yield from bank Upper AA is less than the annual percentage yield from bank Upper BB
B
Bank Upper BBs money market account is the better investment because the annual percentage yield from bank Upper BB is less than the annual percentage yield from bank Upper AA
C
Bank Upper BBs money market account is the better investment because the annual percentage yield from bank Upper BB is greater than the annual percentage yield from bank Upper AA
D
Bank Upper AAs money market account is the better investment because the annual percentage yield from bank Upper AA is greater than the annual percentage yield from bank Upper BB
E
Either bank is a good investment because the annual percentage yield from bank A is the same as the annual percentage yield from bank B
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