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Effective Interest Rate Calculator

Calculates the effective interest rate for a nominal rate and number of periods.

Use this formula calculator for interest rate conversions between nominal and effective.

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Formula: effective(Nom/100, Per) * 100

Nom: The nominal interest rate.

n: The number of compounding periods.

effective(): The function.

Example 1

Calculate the effective interest rate for a nominal rate of 5% and 12 compounding periods?

 

Value Keystrokes Display Description
5 Nom 5.0000 Stores the value.
12 Per 12.0000 Stores the value.
  Eff 5.1162 Calculates the effective rate.

Example 2

Calculate the nominal rate for an effective rate of 5.2% and 12 compounding periods?

These keystrokes assume the values from example 1.

 

Value Keystrokes Display Description
5.2 Eff 5.2000 Stores the value.
  Nom 5.0800 Calculates the nominal rate.

Reference:

Effective interest rate - Wikipedia