## Elementary and Intermediate Algebra: Concepts & Applications (6th Edition)

If you receive 3 percent interest every 6 months, the actual amount of interest received in a year will be: $$(1+.03)^2 -1\\ 1.03^2-1\\ 1.0609-1 \\ .0609$$ Thus, we see that receiving 3 percent every 6 months will result in a higher annual rate than 6 percent interest.