Bank One Offers a Passbook Account with a 5

Multiple Choice

Bank One offers a passbook account with a 5.5% annual rate, compounded quarterly.Bank Two offers a money market account at 4.5%, compounded monthly.Find the better growth by calculating the
Effective rates.What is the greater effective rate?

A) 4.59%
B) 5.61%
C) 0.05%
D) 0.06%
E) none of the above