Which do you prefer: a bank account that pays

5.7%

per year (EAR) for three years ora. An account that pays

2.7%

every six months for three years? b. An account that pays

7.1%

every 18 months for three years? c. An account that pays

0.33%

per month for three years?

(Note: Compare your current bank EAR with each of the three alternative accounts. Be careful not to round any intermediate steps less than six decimal places.)

If you deposit

$1

into a bank account that pays

5.7%

per year for three years:The amount you will receive after three years is

$nothing.

(Round to five decimal places.)a. An account that pays

2.7%

every six months for 3 years? If you deposit

$1

into a bank account that pays

2.7%

every six months for three years:The amount you will receive after three years is

$nothing.

(Round to five decimal places.)Which bank account would you prefer?

5.7% per year for three years

2.7 % every six months for three years

. (Select from the drop-down menu.)b. An account that pays

7.1%

every 18 months for 3 years? If you deposit

$1

into a bank account that pays

7.1%

every 18 months for three years:The amount you will receive after three years is

$nothing.

(Round to five decimal places.)Which bank account would you prefer?

7.1% every 18 months for three years

5.7% per year for three years

. (Select from the drop-down menu.)c. An account that pays

0.33%

per month for three years? If you deposit

$1

into a bank account that pays

0.33%

per month for three yearsThe amount you will receive after three years is

$nothing.

(Round to five decimal places.)Which bank account would you prefer?

0.33% every month for three years

5.7 % per year for three years

. (Select from the drop-down menu.)

Enter your answer in each of the answer boxes.