Problema Solution
c. Comparing interest rates-How much more interest could $500 earn in 5 years, compounded semiannually (two times a year), if the annual interest rate were 5½% instead of 5%?
Answer provided by our tutors
R1effective annual rate =5.575
R2=5.062
so more intrest will be = 5.575 -5.062 =0.513