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Question 8: If you put $50 in a savings account each year that pays 1% interest, how much will you have in 10 years? (In
Question 8: If you put $50 in a savings account each year that pays 1% interest, how much will you have in 10 years? (In other words, what is the future value of a $50 annuity at a rate of 1% for 10 periods?)
- Discussion Question: If, as an investor, you had a choice of daily, monthly, or quarterly compounding, which would you choose? Why?
Question 9: If you put $125 in a savings account that pays 6% (annual rate) compounded monthly, how much will you have at the end of the year? Compare that to $125 at a 6% (annual rate) compounded semi-annually?
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