What is APY(Annual Percentage Yield)? How is the APY compounded semiannually at #15%#, different from the same amount compounded continuously at #14%#?

Answer 1

#15%# compounded semiannually is #15.5625%# annually
and
#14%# compounded continuously is #15.027%# annually

APY refers to how much money you earn on a deposit over a year, taking into account compounding interest.

Now #$100# compounded semiannually at #15%# is #100(1+0.15/2)^2=100xx1.075^2=115.5625# i.e. #15.5625%# annually
#$100# compounded continuously at #14%#, means
#Lt_(n->oo)100xx(1+0.14/n)^n#
= #100xxe^0.14=115.027# i.e. #15.027%# annually
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Answer from HIX Tutor

When evaluating a one-sided limit, you need to be careful when a quantity is approaching zero since its sign is different depending on which way it is approaching zero from. Let us look at some examples.

When evaluating a one-sided limit, you need to be careful when a quantity is approaching zero since its sign is different depending on which way it is approaching zero from. Let us look at some examples.

When evaluating a one-sided limit, you need to be careful when a quantity is approaching zero since its sign is different depending on which way it is approaching zero from. Let us look at some examples.

When evaluating a one-sided limit, you need to be careful when a quantity is approaching zero since its sign is different depending on which way it is approaching zero from. Let us look at some examples.

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