2007-03-23 16:06:21 · 6 answers · asked by kvnbbn 1 in Business & Finance ➔ Careers & Employment
Depends on how it compounded.
Example; if it compounded monthly then it is 6%/12 which is .5% x 1000 = $5 so, you have $1005. Then next month it be .5% x 1005 ect. (I think I did the math correct).
What this do is, you may actually realize more than 6% at the end of the year. This why you may see a bank advertise 6.5% APY (Annual Percentage Yield).
2007-03-23 16:18:08 · answer #1 · answered by Snaglefritz 7 · 0⤊ 0⤋
$5 per month x 12 months = $60 annually.
2007-03-23 23:09:44 · answer #2 · answered by Edub 4 · 0⤊ 1⤋
depends on how the bank gives the dividends. if it's compounded monthly, you will get some interest on it monthly, or you may just get the lump sum of $60 at the end of the year. I've seen both types of accounts.
2007-03-23 23:09:32 · answer #3 · answered by L 5 · 0⤊ 0⤋
Most are compounded. So .06 / 12 = .005
.005 x 1000 = $5 (first month)
$1005 x .005 = $5.025 (second month)
$1010.025 x .005 = $5.050125 (third month)
And so on.
2007-03-23 23:19:17 · answer #4 · answered by Anonymous · 1⤊ 0⤋
Depends if interest compounds annually or monthly. Most CDs compound annually.
2007-03-23 23:31:32 · answer #5 · answered by Mel 6 · 0⤊ 0⤋
It can vary. A monthly interest payment is common.
2007-03-23 23:14:04 · answer #6 · answered by Anonymous · 0⤊ 0⤋