3.5.7.1 Effect

Description

Minimum Origin Version Required: 2019 SR0

This function is used to calculate the effective annual interest rate, given the nominal interest rate nrate and the number of compounding periods per year npery.


Effect = {\left( {1 + \frac{{nrate}}{{nprey}}} \right)^{nprey}} - 1\


Syntax

double Effect( double nrate, int npery )

Parameters

nrate

The nominal interest rate. nrate > 0

nprey

The number of compounding periods per year. npery >= 1

Example

aa=0.05;
bb=4;
effect(aa, bb) = ;  // returns 0.050945

See Also

Nominal, RRI,