Answer: The annual percentage yield (APY) is the total amount of interest earned on an investment over a year, expressed as a percentage of the initial investment. The annual interest rate is simply the interest rate per year, expressed as a percentage.
To convert the APY to the annual interest rate, we can divide the APY by the number of times the interest is compounded in a year. If the interest is compounded monthly, then the number of times the interest is compounded in a year is 12.
So, the annual interest rate for the account is given by:
Annual interest rate = APY / number of times compounded in a year
= 5.9% / 12
= 0.49%
Therefore, the annual interest rate for the account is 0.49%.
Explanation: