Question

Alexandra is comparing three investment accounts offering different rates.

Option A: APR of 1.95% compounding monthly
Option B: APR of 1.99% compounding quarterly
Option C: APR of 1.925% compounding daily
She would like to earn at least a 2% annual yield. Which account(s) will Alexandra the yield she wants?

Answer 1

Alexandra can choose either Option B or Option C to meet her goal.

Step-by-step explanation:

Alexandra is comparing three investment accounts offering different rates:

• Option A: APR of 1.95% compounding monthly
• Option B: APR of 1.99% compounding quarterly
• Option C: APR of 1.925% compounding daily

To determine which account(s) will give her the desired yield, we need to calculate the annual yield for each option. When comparing to the 2% annual yield she wants, Option A will not meet her requirement. However, both Option B and Option C will give her a yield higher than 2%. Therefore, Alexandra can choose either Option B or Option C to meet her goal.