Скачать или смотреть 📚 How to calculate the effective interest rate

✔ https://StudyForce.com
✔ https://Biology-Forums.com
✔ Ask questions here: https://Biology-Forums.com/index.php?...

Follow us:

▶ Facebook:   / studyforceps  
▶ Instagram:   / studyforceonline  
▶ Twitter:   / studyforceps  

The effective rate corresponding to a stated rate of interest r compounded m times per year is:

r_e=(1+r/m)^m−1

Q. Find the effective rate for an account that pays 2.7% compounded monthly, annually, daily, quarterly, semiannually, bimonthly.

Effective interest rate is the one which caters the compounding periods during a payment plan. The nominal interest rate is the periodic interest rate times the number of periods per year. For example, a nominal annual interest rate of 12% based on monthly compounding means a 1% interest rate per month (compounded).