Which of the Following Bank Accounts Has the Lowest Effective

question 31

Multiple Choice

Which of the following bank accounts has the lowest effective annual return?

• A) An account that pays 8% nominal interest with monthly compounding.
• B) An account that pays 8% nominal interest with annual compounding.
• C) An account that pays 7% nominal interest with daily (365-day)compounding.
• D) An account that pays 7% nominal interest with monthly compounding.
• E) An account that pays 8% nominal interest with daily (365-day)compounding.

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Definitions:

Wye-Delta Transformer

A transformer configuration used to shift between high and low voltages in a three-phase electrical system, involving a star (Wye) connection and a delta connection.

Wye

A configuration in electrical engineering where three phase circuits are connected at a single point, forming a 'Y' shape, allowing for both three-phase and single-phase connections.

Delta

A method of connecting three electrical components in a triangular configuration, allowing for the completion of a circuit without a neutral path.

Open Delta

A connection method for three-phase transformers where only two transformers are used, providing a way to supply three-phase power with reduced capacity.