Would a depositor prefer an APR of 8% with monthly compounding or an APR of 8.5% with semiannual compounding?

Therefore depositor would prefer an APR of 8.5% with semiannual compounding

Explanation:

First determine the Effective Interest Rate of the two Returns, then compare the Rates.

The Effective Annual Rate of Interest is the Annual rate that if compounded once a year, would give us the same result as the interest per period compounded a number of times.

1. APR of 8% with monthly compounding

Calculation of Effective Annual Rate of Interest using a Financial Calculator:

8 % Shift NOM %

12 Shift P/YR

Shift EFF % = 8.3 %

2. APR of 8.5% with semiannual compounding

Calculation of Effective Annual Rate of Interest using a Financial Calculator:

8.5 % Shift NOM %

2 Shift P/YR

Shift EFF % = 8.6806 or 8.68 %

Conclusion.

Choose the APR giving greater  Effective Annual Rate.

Comparing the 2 Effective Annual Rate of Interest, it can be seen that an APR of 8.5% with semiannual compounding gives a greater Effective Annual Rate of Interest.

Therefore depositor would prefer an APR of 8.5% with semiannual compounding

because she sucked. : )

(but so does trump, don't @ me)

answer; i believe its (d) intrinsic;