Compound Interest Compounding can substantially affect the rate of return.A 9%annual interest compounded daily provides a 9.42%yield. How compounding affects Effective yield for a $10,000 investment. Compounding Periods Illustration 6-5 Interest Rate Annually Semiannually Quarterly Monthly Daily 8% 8.00% 8.16% 8.24% 8.30% 8.33% $800 $816 $824 $830 $833 9% 9.00% 9.20% 9.31% 9.38% 9.42% $900 $920 $931 $938 $942 10% 10.00% 10.25% 10.38% 10.47% 10.52% $1,000 $1,025 $1,038 $1,047 $1,052 Chapter 6-12 LO 3 Use appropriate compound interest tables.Chapter 6-12 Compounding can substantially affect the rate of return. A 9% annual interest compounded daily provides a 9.42% yield. How compounding affects Effective Yield for a $10,000 investment