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    CD & Expected Return

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    I am needing to calculate the expected return of a CD and my textbook does not cover this calculation. When asking my instructor, all I was told it was just the interest rate used and given no formula.

    Please help me calculate the expected return of the following CD:

    Transportation Alliance Bank (Ogden, UT) - 4 star rating, interest rate: 5.2%, compounded daily, APY: 5.34%, minimum deposit: $1,000

    Thank you.

    © BrainMass Inc. brainmass.com June 3, 2020, 6:56 pm ad1c9bdddf

    Solution Preview

    As your professor said, the expected return on a CD is just the interest ...

    Solution Summary

    The expert examines CDs expected return.