Having a little trouble with getting the answer to this question.
: How much better is the return on a 4% yearly interest rate investment that is compounded 3 times per year as opposed to compounded yearly?
I tried to set up the equation as :
10000(1.04)^n = 10000(1+.04/3)^3n n=1
then to compare the them :
10400/ 1.040535704 = 0.999485
I’m guessing I am not setting things up right…
I am suppose to get answer 1% – 1.5% better.