Calculating an EAR)Based on effective interest rates, would you prefer to deposit your money into Springfield National Bank, which pays

10.0 percent interest compounded monthly, or into Burns National Bank, which pays 9.8 percent compounded daily?

(Hint: Calculate the EAR on each account.)

1) If Springfield National Bank pays 10.0 percent interest compounded monthly, the EAR for the deposit is _____%

2) If Burns National Bank pays 9.8 percent interest compounded daily, the EAR for the deposit is _____%

3) Based on the findings above, which alternative is more attractive?