question archive Suppose you buy a CD for $1000 that earns 2
Suppose you buy a CD for $1000 that earns 2
Subject:MathPrice:2.87 Bought7
Suppose you buy a CD for $1000 that earns 2.5% APR and is compounded quarterly. The CD matures in 5 years. Assume that if funds are withdrawn before the CD matures, the early withdrawal fee is 3 months' interest. What is the early withdrawal fee on this account?.
A.$3.75.
B.$6.25.
C.$3.13.
D.$1.25.
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Answer:
The early withdrawal fee on this account if funds are withdrawn before the CD matures is $6.25.
The correct answer between all the choices given is the second choice or letter B.
