Rank the following three bank deposit options from best to worst.
Bank A: 5 % compounded daily Bank
B: 5.1 % compounded monthly
Bank C: 5.03 % compounded continuously
Assuming the same principal and a one year compounding period, we have....
A = (1 + .05/365)^365= 1.0512674964674626
B = (1 + .051/12)^12 = 1.0522091760368192
C = e^.0503 = 1.0515865250168672
"B" looks to be the best option
