Your grandmother asks for your help in choosing a certificate of deposit (CD) from a bank with a one-year maturity and a fixed interest rate. The first certificate of deposit, CD #1, pays 1.95 percent APR compounded monthly, while the second certificate of deposit, CD #2, pays 2.00 percent APR compounded weekly. What is the effective annual rate (the EAR) of each CD, and which CD do you recommend to your grandmother?

This problem has been solved! see the answerwhich of the following statements is correct? the consumer price index is a measure of the overall level of prices, whereas the gdp deflator is not a measure of the overall level of prices. if, in the year 2011, the consumer price index has a value of 123.50, then the inflation rate for 2011 must be 23.50 percent. compared to the gdp deflator, the consumer price index is the more common gauge of inflation. the consumer price index and the gdp deflator reflect the goods and services bought by consumers equally well.