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Comparing Investment Options Compare two savings accounts: one offers a 5 . 2 5 % interest rate with daily compounding, another offers 5 . 3

Comparing Investment Options

Compare two savings accounts: one offers a

5.25 %

interest rate with daily compounding, another offers

5.3 %

with semiannual compounding. Calculate the Effective Annual Rate

(

EAR

)

for both and decide which account is more beneficial.

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