On the first of the year, James invested x dollars at Proudstar bank in an account that yields 1.5% in interest every quarter year. At the end of the year, during which he made no additional deposits or withdrawals, he had y dollars in the account. If James had invested the same amount in an account which pays interest on a yearly basis, what must the interest rate be for James to have y dollars at the end of the year?	Choose the correct answer
A) 11.04%
B) 6.12%
C) 8%
D) 7.25%
E) 10%
Per quarter, interest = 1.5% So for a year, interest = 6% Due to quarter cumulation, effective yield (YTM) would be slight higher than 6% Answer = 6.12% =ANSWER:6.12%
<result>B</result>
On the first of the year, James invested x dollars at Proudstar bank in an account that yields 1.5% in interest every quarter year. At the end of the year, during which he made no additional deposits or withdrawals, he had y dollars in the account. If James had invested the same amount in an account which pays interest on a yearly basis, what must the interest rate be for James to have y dollars at the end of the year?