Question

interest is compounded 10.000 times per yea Suppose a savings and loan pays a nominal role of 3% on savings deposits. Find the effective annual The effective annual yield is Type an integer or a decimal rounded to the nearest thousandth as needed)

Answer 1

Effective annual interest rate = (1 + (nominal rate / number of compounding periods)) ^ (number of compounding periods) - 1.
(1+(3.9%/10000))^10000-1
3.977%
Payment Number	Total Payment	Interest Payment	Principal Payment	Balance of principal
				$118,250
1	$          784.80	$369.53	$415	$117,835
2	$          784.80	$368.23	$417	$117,418
Principal	118250
Term of Loan (17*12)	204
Monthly Interest Rate (3.75%/12)	0.003125
Monthly Payment	$   784.80
(0.003125*118250*(1+0.003125)^204)/(((1+0.003125)^204)-1)
Interest Payment
1	118250*0.003125	$ 369.53
2	117835*0.003125	$ 368.23