Question

n = 2; n = 12; n = 365; n = 4; 1. compounded annually; 2. compounded semi - annually; 3. compounded quarterly; 4. compounded monthly; 5. compounded daily; question 6 (10 points)

Explanation:

Step1: Recall compounding periods

• Compounded annually: interest is compounded once a year, so \( n = 1 \)? Wait, no, wait. Wait, the problem here is matching \( n \) (number of compounding periods per year) with the compounding frequency.
• Compounded semi - annually: semi - annual means 2 times a year, so \( n = 2 \).
• Compounded quarterly: quarterly means 4 times a year, so \( n = 4 \).
• Compounded monthly: monthly means 12 times a year, so \( n = 12 \).
• Compounded daily: daily means 365 times a year (ignoring leap years for simplicity), so \( n = 365 \).

Step2: Match each \( n \) with the correct compounding frequency

• For \( n = 2 \): This corresponds to compounded semi - annually (since semi - annual means 2 times per year).
• For \( n = 12 \): This corresponds to compounded monthly (since monthly means 12 times per year).
• For \( n = 365 \): This corresponds to compounded daily (since daily means 365 times per year).
• For \( n = 4 \): This corresponds to compounded quarterly (since quarterly means 4 times per year).

Answer:

• \( n = 2 \): 2. Compounded semi - annually
• \( n = 12 \): 4. Compounded monthly
• \( n = 365 \): 5. Compounded daily
• \( n = 4 \): 3. Compounded quarterly