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Two competing investments

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A person buys a five year $1,000 certificate of deposits that carries a nominal rate of 9 percent, compounded seminannually. Six months after this purchase, a 4 1/2 year CD at the same bank offers a 9.5 percent annual rate, also compounded semiannually. How much difference is there in total interest paid by the two competing investments?

Reference no: EM132443370

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