Final answer:
To calculate the effective annual yield for an 8.7% interest rate compounded continuously, we use the continuous compounding formula with the base of the natural logarithm, assuming the question intended to write '8.7% compounded continuously'.
Step-by-step explanation:
The question appears to ask about the calculation of the effective annual yield when the interest rate is compounded continuously. To find the effective annual yield for an interest rate compounded continuously, we use the formula A = Pert, where P is the principal amount, e is the base of the natural logarithm, r is the annual interest rate, and t is the time in years. However, the given question seems to have some typos and missing information.
Assuming the intended question was about an 8.7% interest rate compounded continuously, the formula transforms to A = Pe0.087t for calculating the amount after time t. For one year, t equals 1, and the effective annual yield can be calculated by re-arranging the formula to solve for e0.087, which gives us the factor by which the principal will grow in one year.