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Would you rather have a savings account that pays 5% compounded annually, or an account that...

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Finance

Would you rather have a savings account that pays 5% compoundedannually, or an account that pays 5% compounded monthly? Be sure toexplain your position here.

Answer & Explanation Solved by verified expert
4.0 Ratings (437 Votes)
A savings account that pays 5 compounded monthly will be preferred The higher the compounding frequency the higher interest amount we will get For example we deposit 1000 is 2    See Answer
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Would you rather have a savings account that pays 5% compoundedannually, or an account that pays 5% compounded monthly? Be sure toexplain your position here.

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