answersLogoWhite

0

derivation of this formula r=(1+i/m)m-1

User Avatar

Wiki User

13y ago

What else can I help you with?

Related Questions

What does effective interest rate mean?

An effective annual interest rate considers compounding. When the principle is compounded multiple times each year the interest rate increased to be more than the stated interest rate. The increased interest rate is the effective annual interest rate.


A borrower is often confrented with a stated interest rate and an effective interest rate What is the difference and which one should a financial manager recognize as the true cost of borrowing?

A stated interest rate is the rate that is available when you are applying. An effective interest rate is the rate that has been applied to the loan. The true cost of borrowing is the effective interest rate.


What is nominal interest?

Nominal InterestA nominal interest rate is the interest rate that does not compensate for inflation. This is used in relation to "effective interest rate" or "real interest rate."" Real Interest Rate = Nominal Interest Rate - Inflation Rate " Improvement suggested by Palash Bagchi.


When is normal interest rate lower then effective interest?

Only on Tuesdays.


What is the effective borrowing rate?

The new interest rate due to the impact of the total fees is 13.233 % which translates into an effective interest rate of 13.6708 % due to semi-annual compounding.


The rate of interest that is actually incurred on a bond payable is called?

Effective rate.


How do you calculate effective interest rate on a line of credit?

how is line of credit interest calculated


What is the continuous compounding rate equivalent to an effective interest rate of 18 percent?

2


Find the effective rate when the stated rate is 13.5 percent and the interest is compounded semiannually?

13.96%


Candis took out a pay day loan with an effective interest rate of 15400 if she had $220 to invest for a year at this interest rate how much would she make in interest.?

At 15400% she would make 33880 in interest.


How do you calculate effective interest rate when you do not know the rate of interest?

That depends on what you DO know. You might consider asking again, being more specific about what information you have. For example, if you know the amount of interest, the principal, and the length of time, you can readily calculate the effective interest rate even if you don't know the nominal value or how often it's compounded.


What is the difference between effective interest method and constant yield method?

An investment's annual rate of interest when compounding occurs more often than once a year. Calculated as the following: Consider a stated annual rate of 10%. Compounded yearly, this rate will turn $1000 into $1100. However, if compounding occurs monthly, $1000 would grow to $1104.70 by the end of the year, rendering an effective annual interest rate of 10.47%. Basically the effective annual rate is the annual rate of interest that accounts for the effect of compounding.

Trending Questions
Give you give me an example of a monopoly? What factors can lead to an excess supply of goods or services as shown on a supply and demand graph? Is crime higher in capitalist countries? What is the role of price mechanism in a free market? Why does old major say man is the only creature that consumes without producing? What did craftsmen and merchants try to do to make more money? What is the value of yougoslovia 1993 currency in 500000 to inr? What is the result of borrowing P20 and paying P8? What The Internet helps consumers make well-informed decisions because of? What is the current price for a kilo of copper? What is the term that describes the ability of a market participant to influence prices instead of merely being forced to accept market prices? Are there any borders within the European Union? What was the relationship between government and business in the late 1800? How much money is the internet worth? Is it smart to invest in gold at this time? What kind of illegal activities does a black market do in the economic status of Philippines? Why should managers mainly focus on economic profits? Are there any exceptions to the law of demand? Assume the US can use a given amount of its resources to produce either 20 airplanes or 8 automobiles and Japan can employ the same amount of its resources to produce either 20 airplanes or? What is it called when something would help build a strong economy by issuing a single form of money among other purposes?