Question
What are APR *and* APY rates of investment X that earns 0.2% per week, compounded weekly? You can invest (that is, 'lend') for one year
What are APR *and* APY rates of investment X that earns 0.2% per week, compounded weekly?
You can invest (that is, 'lend') for one year either at the rate X described above, or, alternatively, at the rate Y that offers the risk premium of 6.5% above today's value of 1-year U.S. Treasury rate. If you consider both investments equally risky - would you invest in X or Y? Why?
Step by Step Solution
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Step: 1
To calculate the APR Annual Percentage Rate and APY Annual Percentage Yield of investment X we need ...
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Microeconomics An Intuitive Approach with Calculus
Authors: Thomas Nechyba
1st edition
538453257, 978-0538453257
