cccmom wrote:
An investor opened a money market account with a single deposit of $6000 on Dec. 31, 2001. The interest earned on the account was calculated and reinvested quarterly. The compound interest for the first 3 quarters of 2002 was $125, $130, and $145, respectively. If the investor made no deposits or withdrawals during the year, approximately what annual rate of interest must the account earn for the 4th quarter in order for the total interest earned on the account for the year to be 10 percent of the initial deposit?
A. 3.1%
B. 9.3%
C. 10.0%
D. 10.5%
E. 12.5%
I got the answer as 3.1 first. But then realized it has to be multiplied by 4 to adjust for making it annual rate.
Bunuel Please suggest some literature to read about the conversions and tough questions based on them.
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