There's a bank advertising a 12% savings account, but the condition is that you have to place a certain amount in the account every month for a year, after which you can withdraw your savings.
If, for example, I put £100 a month into the account then in January, the first instalment, I would be earning 12% for the full twelve months. But the February instalment is only earning 12% for 11 months, and the March instalment for only 10 months, - so at the end of the year you haven't really earned 12% interest on all the money you have put in there. I'd have put in £1,200 (12 x £100) but how much interest would I actually have earned, in percentage terms?
Please can you let me know, and also let me know the calculation that you used to get there? My maths isn't that hot !
2007-01-03
21:08:49
·
5 answers
·
asked by
gorgeousfluffpot
5
in
Business & Finance
➔ Investing