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To convert an annual percentage rate (APR) to an effective annual rate (EAR), you need to take into account the compounding frequency. The formula is EAR (1 (APR/n))n - 1, where n is the number of compounding periods in a year. This calculation gives you the true annual rate you will pay or earn on a financial product after accounting for compounding.

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5mo ago

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How can I convert the effective annual rate (EAR) to the annual percentage rate (APR)?

To convert the effective annual rate (EAR) to the annual percentage rate (APR), you can use the formula: APR (1 EAR/n)n - 1, where n is the number of compounding periods per year.


What is the effective annual rate (EAR) if the annual percentage rate (APR) is 5 and compounding is quarterly?

The effective annual rate (EAR) is 5.09 when the annual percentage rate (APR) is 5 and compounding is done quarterly.


What is the effective annual rate for a credit card with a 9.9 percent annual percentage rate that is compounded daily?

The effective annual rate for a credit card that carries a 9.9% annual percentage rate (compounded daily) is 10.4%.


What is the formula for calculating the effective annual rate (EAR) when using the annual percentage rate (APR)?

The formula for calculating the effective annual rate (EAR) when using the annual percentage rate (APR) is: EAR (1 (APR/n))n - 1 Where: EAR is the effective annual rate APR is the annual percentage rate n is the number of compounding periods per year


What is the difference between the annual percentage rate (APR) and the effective annual rate (EAR)?

The annual percentage rate (APR) is the interest rate charged on a loan or credit card on an annual basis, while the effective annual rate (EAR) takes into account compounding interest and any additional fees to provide a more accurate representation of the true cost of borrowing over a year.


How can I convert an annual rate to a monthly rate?

To convert an annual rate to a monthly rate, divide the annual rate by 12. This will give you the equivalent monthly rate.


Is the annual percentage rate usually lower than the actual interest rate on the loan?

The actual interest rate on a mortgage will always be higher than the annual percentage rate unless the borrower keeps the loan for the full term. Refinancing or selling before the end of the term results in a much higher actual (effective) interest rate. The effective rate on a mortgage can be lower than the annual percentage rate (fixed rate) by paying extra to principal especially early in the mortgage term.


What is the nominal annual rate of return?

The nominal annual rate of return is calculated from the effective interest rate. It is typically a slightly lower percentage, and gives investors an idea of what their investment may return.


How can I convert an annual interest rate to a monthly interest rate?

To convert an annual interest rate to a monthly interest rate, divide the annual rate by 12. This will give you the equivalent monthly rate.


How to convert a monthly interest rate to an annual interest rate?

To convert a monthly interest rate to an annual interest rate, you can multiply the monthly rate by 12. This will give you the annual interest rate.


What is the maximum annual percentage rate for visa?

The annual percentage rate may vary but it can be increased to an 18% APR.


What describes a annual percentage rate?

A measure of the cost of credit expressed as a yearly interest rate.