Financial calculator

Effective Annual Rate

Calculate effective annual rate (%) using the effective annual rate formula.

Nominal annual rate (%)Compounding periods per year

Effective annual rate (%): -

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Calculation explained

How this result was calculated

The formula, your substituted values, and the evaluated result are shown below.

Reference: Formulae and Tables, State Examinations Commission (2014), page 33.

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How the Effective Annual Rate works

This calculator applies the formula given in Formulae and Tables, State Examinations Commission (2014), page 33. Enter values in consistent units.

Formula and inputs

(Math.pow(1+nominal ÷ 100 ÷ periods,periods)-1) × 100

Inputs: Nominal annual rate (%), Compounding periods per year.

Using the result

The result is rounded to 4 decimal places. Check units, assumptions and significant figures before using the answer.