EXERCISE SET 4: Fill in the APY values in the table below. Answer with a percent rounded to three decimals places. A recent look at mortgage rates for S&T Bank shows the following: APY con- tinuously Loan APR APY APY Quarterly Monthly 30 year fixed mort- 4.192% gage 20 year fixed mort- 4.025% Sage 10 year fixed mort- 3.902% Babe EXERCISE SET 5: Answer the following questions. 1. Suppose that an investor has to choose between two investment accounts: Account 1 with a stated annual interest rate of 10% compounded daily (365 times a year) and Account 2 with a stated annual interest rate of 10.13% compounded semianmaally (twice a year). Determine which is the better choice by comparing effective interest rates rounded to three docimals? Account 1 APY: % Account 2 APY % Better Choice: (Account 1 or Account 2?) 2. You invest $2,000 in an account at WestAircomm Federal Credit Union that pays 8% interest compounded continuously. You plan to hold the account exactly 3 years. At the same time, you deposit money in an account at Key Bank that earns 9% compounded semiannually. If the accounts are to have the same amount at the end of the 3 much of an initial deposit do you need to make at Key Bank? years, how Amount In 3 Years (round to nearest cent): S Deposit in Key Bank: $ 3. Taking into consideration all forms of compounding and assuming you carn 100% interest, what is the maximum amount of money you can make in one year on an investment of $1.00? On the first blank type the name of the general model to use, type the value of P and followed by the specific model for this problem on the next 3 blanks, and finally fill in the blanks for the input value, output value, and the maximum dollar value at the end of the year to conclude this problem. Type of Model: (compound interest or continuous compounding) Specific Model To Use: P -T= __ (NOT a percent) The model to use is A(l) 7 To Find Maximum Amount: AC)= (round to two decimal places) Using my model, this investment will grow to $ (round to the nearest cent) in one year. This means the maximum amount you can make on $1 invested at 100% for a year is $ (round to the nearest cent). 4. Suppose you invest money under continuous compounding with an APY (anmal yield) of of 4.238%. (a) Type an equation that can be used to solve for the animal rate (APR), T. You need not solve the equation. Equation: (b) Fill in the APY values (assuming continuous compounding) in the table below and determine an appropriate range for r from part (A) APY (continuous comp.) APR 13.99% 4% 4.08% 4.12% 4.19% 4.21% r is between % and