What does Annual Percentage Yield (APY) primarily represent for a savings account?

A) The monthly interest rate earned.

B) The total fees charged annually by the bank.

C) The actual annual rate of return, taking compounding into account.

D) The minimum balance required to avoid service fees.

Explanation

APY (Annual Percentage Yield) is the actual rate of return earned on a savings account, considering the effect of compounding interest. It provides a standardized way to compare interest-bearing accounts.

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