What is the APY for money invested at each​ rate? ​(A) 11​% compounded monthly ​(B) 12​% compounded continuously

Question

What is the APY for money invested at each​ rate?

​(A) 11​% compounded monthly

​(B) 12​% compounded continuously

​(A) APY=_______ ​% ​(Round to three decimal places as​ needed.)

(B) APY = ________ % ​(Round to three decimal places as​ needed.)

Answer 1

a) (1 + .11/12)¹² - 1 = 11.572%

b) e^.12 - 1 = 12.750%

Answer 2

Here's the formula:

fv=p(1+int/c)^(nt)

future value

principal

int

compound

years

times/yr

Be sure to subtract the principal from the fv for the int.