Question: Hwk: Ch 3 ( Problem 3 - 4 3 ( modified ) A bank advertises it pays 4 % annual interest, compounded daily, on savings

Hwk: Ch 3(Problem 3-43(modified)
A bank advertises it pays 4% annual interest, compounded daily, on savings accounts, provided the money is left in the account for 5 years.
1. What is the effective annual interest rate?
2. If the 4% is compounded quarterly, what is the effective annual interest rate?

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