# Which would you prefer? a. An investment paying interest of 12 percent compounded annually. b. An investment paying interest of

## Question:

Which would you prefer?

a. An investment paying interest of 12 percent compounded annually.

b. An investment paying interest of 11.7 percent compounded semiannually.

c. An investment paying 11.5 percent compounded continuously.

Work out the value of each of these investments after 1, 5, and 20 years.

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## Step by Step Answer:

**Related Book For**

## Principles of Corporate Finance

**ISBN:** 978-0072869460

7th edition

**Authors:** Richard A. Brealey, Stewart C. Myers

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