Heres what happens, you tell me the results.
I buy a 1 month CD at my local bank.
The initial deposit is $20,000
The interest rate is 4.74%.
Interest compounds daily.
APY is 4.85%.
How much will you end up with after 1 month?
Why pursue a 2 month CD at a bank, when you can just keep renewing your 1 month CD? For example, if a 2 month CD yields 4%, and a 1 month CD yields 3.5%, why not just get a 1 month cd and end up with 7% after 2 months? Is that how it works. Clear up my confusion FINANCIAL MASTERS!
2006-09-10
06:41:51
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3 answers
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asked by
John R
1
in
Investing