You have $50 000 to invest in the stock market and have sought the advice of Ada

Question

You have $50 000 to invest in the stock market and have sought the advice of Adam, an experienced colleague who is willing to advise you, for a lee. Adam has told you that he has found a one-year investment for you that pn>vides 15 percent interest, compounded monthly. What is the effective annual interest rate based on a 15 percent nominal annual rate and monthly compounding Adam says he will make the investment for you for a modest fee of 2 percent of the investment's value one year from now If you invest the $50 000 today, how much will you have at the end of one year (before Adams fee)?

Explanation / Answer

amount at the end of a year=P(1+R/12*100)^12 =58307$ so effective annual rate = 58307-50000/50000 *100 =16.6% this answers both the questions hope my answer is correct and please appreciate my help by awarding me karma points

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