For an investment that earns 15.0% compounded monthly for two years, how many compounding periods are there?-2-24-12-120
24
There are 24 compounding periods in two years with monthly compounding for an investment that earns 15.0%.
To calculate the number of compounding periods, we need to know the compounding frequency and the time period for which the interest is applied. Here, the investment earns 15.0% compounded monthly for two years.
The formula for calculating the number of compounding periods is:
n = t x f
where n is the number of compounding periods, t is the time period in years and f is the compounding frequency per year.
In this case, t = 2 years and f = 12 (since interest is compounded monthly).
Substituting these values into the formula, we get:
n = 2 x 12 = 24
Therefore, there are 24 compounding periods in two years for an investment that earns 15.0% compounded monthly.
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