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This question is about apr vs apy.
Is APR or APY better?
The rule of thumb is that if you're borrowing, APR is better, and if you're lending, APY is better. Since the interest is compounded in APY, you'd end up paying more in interest if you had that on, say, a car loan.
However, if you put your savings into a CD account and the interest is compounded, then you end up making more money in interest from the bank.
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