IDNLearn.com is designed to help you find reliable answers to any question you have. Get the information you need from our community of experts who provide accurate and thorough answers to all your questions.
Sagot :
Joel takes out a loan with a stated rate of 11.85% interest. If the interest is calculated weekly, 0.72 percentage points greater is joel’s effective rate than his stated rate.
EARs are often accustomed to evaluate interest payable on a loan or any debt or to assess earnings from an interest investment, like a guaranteed investment certificate (GIC) or bank account.
The effective annual rate is additionally referred to as the effective charge per unit (EIR), annual equivalent rate (AER), or effective rate. The effective annual rate is often beyond the nominal rate because the nominal rate quotes a yearly percentage rate no matter compounding.
Increasing the amount of compounding periods increases the effective annual rate as compared to the nominal rate. Effective yield takes into consideration the facility of compounding on investment returns, while nominal yield doesn't.
The stated annual rate describes an annualized rate of interest that doesn't take under consideration the effect of intra-year compounding.
learn more about interest: https://brainly.com/question/25793394
#SPJ4
Thank you for using this platform to share and learn. Keep asking and answering. We appreciate every contribution you make. IDNLearn.com provides the answers you need. Thank you for visiting, and see you next time for more valuable insights.
