Question: ( 1 ) Consider a 1 - year, $ 5 0 , 0 0 0 C D . ( a ) What is its value
Consider a year, $
a What is its value at maturity if it pays percent annual interest?
b What would be the future value if the CD pays percent? What if it pays percent?
c The Fourth National Bank of Oakland offers CDs with a percent nominal Interest rate but compounds semiannually. What is the effective rate on such a CD What would its future value be
d Golden Gate Trust offers percent CDs with dally compounding. What is such a CDs effective annual rate and its value at maturity?
e What nominal rate would the Fourth National Bank have to offer to make iss semiannual compounding CD competitive with Golden Gatels dallycompounding CD
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