Some values below may show as rounded for display purposes, though unrounded numbers should be used for actual calculations.
With continuous compounding, the effective annual rate is computed as:
| EAR | = | ert – 1 |
| = | e(.057 × 1) – 1 | |
| = | 0.0587, or 5.87% |
Tuesday, 26 September 2017
If a bank pays 5.7% interest with continuous compounding, what is the effective annual rate?
If a bank pays 5.7% interest with continuous compounding, what is the effective annual rate? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)
Some values below may show as rounded for display purposes, though unrounded numbers should be used for actual calculations.
With continuous compounding, the effective annual rate is computed as:
Some values below may show as rounded for display purposes, though unrounded numbers should be used for actual calculations.
With continuous compounding, the effective annual rate is computed as:
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