Question
A bank offers two interest rates for a fixed deposite
Offer 1: 12% compounded quarterly
Offer 2: 13.55% simple interest
If Ali want to invest for one year, which offer would he choose?. Show your working
Offer 1: 12% compounded quarterly
Offer 2: 13.55% simple interest
If Ali want to invest for one year, which offer would he choose?. Show your working
Answers
R_scott
quarterly ... {[1 + (0.12 / 4)]^4} - 1 = ?
simple ... 0.1355
which is greater
simple ... 0.1355
which is greater