Question

How much better is the return on a 6% yearly interest rate investment that is compounded 6 times per year as opposed to compounded yearly?

Select one:

a. Between 1.5% and 2.0% better
b. Between 2.0% and 2.5% better
c. Between 2.5% and 3.0% better
d. Between 3.5% and 4.0% better

Answer 1

(1+.06/6)^6 / (1+.06)^1 = 1.051
so, ...