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Nominal-to-Effective Rate with Continuous Compounding

The effective interest rate is the interest rate on a loan or financial product restated from the nominal interest rate as an interest rate with annual compound interest payable in arrears.

The effective interest rate equals the exponential of the nominal interest rate minus 1.

Formula

QuantityVariable[SuperStar["r"], "Unitless"] == -1 + E^QuantityVariable["r", "Unitless"]

symbol description physical quantity
r* effective interest rate "Unitless"
r nominal interest rate "Unitless"

Forms

Examples

Get the resource:

In[1]:=
ResourceObject["Nominal-to-Effective Rate with Continuous \ Compounding"]
Out[1]=

Get the formula:

In[2]:=
FormulaData[ ResourceObject[ "Nominal-to-Effective Rate with Continuous Compounding"]]
Out[2]=

Use some values:

In[3]:=
FormulaData[ ResourceObject[ "Nominal-to-Effective Rate with Continuous Compounding"], \ {QuantityVariable[SuperStar["r"],"Unitless"] -> Quantity[8.3`, "Percent"]}]
Out[3]=

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