How to Calculate the Effective Annual Rate of Interest (EAR)

Why not just do (i/n) ^n ? Why have 1 there just to offset it with -1?

There is a mistake that is (n) the correct is (m)

I have a quick question, if 5% was the Annual rate, would we need to divide it by 4 to get the Qrtly rate then we can compound it or am I over thinking?

informative, simple, and clear. Thank you!

Thanks for the knowledge sharing

These videos are very informative and clear to the point, thank you for your service!

something is missing here because in my studies where i am struggling is with the fact the equation does not end after you calculate the second step some say you must raise that number to the number of periods so a good video but does not explain the full concept thank you

Did u use a calculator for the amount?

Hi can you reply for me ? what if its compounding period is indicated in days.

THANK YOU!

this video blows

Solving the problem and walking the steps was why we sat through your video. Talk less and solve more.

THANKS..

How about "continuous compound," where n is taken to infinity (result being e^i-1 for one stated interest period, and e^(i*k)-1 for k stated interest periods)? e being the irrational number starting with 2.718...

How would you calculate what n is if given the EAR and the periodic rate (i/n)?

Doesn't quarterly mean that n should be equal to 3?
Edit: Nevermind, my bad. N is number of how many times we compound.

Good one

Thanks!

Another good video- however would’ve really helped with an example. For example leasing a car for 4 years at £450 a month. Interest is 3%. What’s the ERI used for accounting...

watch at 1.5x speed. Much better.