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A company has made an investment of $30,000, which matures in 180 days and pays $800 in interest. Which of the following is the effective annual yield?
Suggested Answer: D
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26 comments · newest first
VA
Vanda
10 months ago
1.33% seems too low for this investment.
MO
Moon
10 months ago
Definitely going with option D, 5.40%!
RE
Remedios
10 months ago
I think the effective yield is around 5.33%.
MA
Marylin
10 months ago
Wait, how can it be that high? Sounds off.
PA
Paulina
10 months ago
The investment is $30,000 with $800 interest in 180 days.
VI
Viva
11 months ago
I feel like the answer should be higher than 1% since it's a decent amount of interest on that investment. Maybe D?
TI
Tijuana
11 months ago
I think the effective yield is calculated by annualizing the interest, but I can't recall the exact steps.
TA
Tawanna
11 months ago
This question feels familiar; I think we did a similar one with different numbers. I might lean towards option C.
KA
Kaycee
11 months ago
I remember we calculated effective annual yield in class, but I'm not sure if I got the formula right for this one.
KR
Kristel
11 months ago
Okay, I think I see what I need to do. Let me work through this step-by-step and I'm confident I can get the right answer.
HA
Hassie
12 months ago
No problem, I've got this. The key is to first find the simple annual interest rate, which is $800 / $30,000 = 0.0267 or 2.67%. Then I can convert that to an effective annual yield using the formula.
CA
Caitlin
12 months ago
Wait, how do I calculate the effective annual yield from this information? I'm a bit confused on the formula I need to use here.
BU
Buddy
12 months ago
Hmm, this seems straightforward enough. I think I can handle this, but I'll need to double-check my work to make sure I don't miss anything.
JU
Julio
1 year ago
Okay, let's think this through step-by-step. We have an investment of $30,000 that matures in 180 days and pays $800 in interest. To find the effective annual yield, we need to calculate the annual interest rate and then convert it to an effective annual rate.
BE
Benedict
1 year ago
I believe the correct answer is 5.33%.
JO
Josefa
1 year ago
I disagree, I calculated it to be 1.33%.
AR
Argelia
1 year ago
Ah, the age-old question: what's the effective annual yield on a $30,000 investment that pays $800 in interest over 180 days? Easy, it's B) 1.33%.
MA
Mayra
1 year ago
I'm thinking it's actually C) 5.33%.
LI
Linwood
1 year ago
Really? I lean towards B) 1.33%.
ZE
Zena
1 year ago
I believe it's closer to D) 5.40%.
BR
Britt
1 year ago
Wow, this is tricky. I'm torn between A) 1.31% and D) 5.40%. Maybe I should just flip a coin...
LA
Lanie
1 year ago
C) 5.33% seems a bit too high. I'm going with B) 1.33% as the effective annual yield.
KI
Kiley
1 year ago
Hmm, let's see... I think the answer is D. 5.40% seems about right for an investment that pays $800 in interest on a $30,000 investment over 180 days.
ED
Edmond
1 year ago
I'm not sure, maybe it's A) 1.31%?
LO
Lonny
1 year ago
I think the answer is D. 5.40%
BU
Bulah
1 year ago
I think the effective annual yield is 1.31%.