Question

What's the annual percentage yield for money invested at the rate of 3.2% compounded continuously?

Answer:__________ %

Convert your answer into a percentage. Round your answer to 2 decimal places.

Answer 1

The Annual percentage yield is 3.25%.

Explanation:

Given : Money invested at the rate of 3.2% compounded continuously.

To find : What's the annual percentage yield?

Solution :

Money invested at the rate of 3.2% compounded continuously.

The compounded continuously formula is

`A=Pe^(rt)`

Where, P is the principal P=1

t is the time t=1

r is the interest rate r=3.2%=0.032

Substitute the value in the formula,

`A=Pe^(rt)`

`A=1* e^(0.032)`

`A=1.0325`

The Annual percentage yield is

`APY=(A-1)* 100`

`APY=(1.0325-1)* 100`

`APY=0.0325* 100`

`APY=3.25\%`

Therefore, The Annual percentage yield is 3.25%.