1) In Homework number three we discussed if it is better to have interest compounded annually, quarterly, or monthly. Most of you responded appropriately that monthly would earn the most interest. For the first question we are going to quantify how much that difference really is. The year is 1980. Inflation is out of control and interest rates are incredible high. Assume you deposit $10,000 into three different banks named Bank A, Bank B, and Bank C. Bank A pays 12% interest compounded annually, Bank B pays 12% interest compounded quarterly, and Banks C pays 12% interest compounded monthly. Calculate the balance you will have in each bank at the end of 5 years. How much more interest did you earn by having interest compounded monthly? Hint: Solving problems with compounding other than annually requires modifications to your formula inputs. Specifically, 12% compounded quarterly needs to be input as 3% (12%/4). You also need to adjust the number of periods (NPER) as compounding quarterly means you have four periods per year paying 3% interest