If the EAR of interest is known to be 17% on a debt that has semi-annually...

Question

Question

If the EAR of interest is known to be 17% on a debt that has semi-annually payments, what is the annual percentage rate? Mult

Answer 1

Answer #1

EAR=[(1+APR/m)^m]-1
where m=compounding periods

0.17=[(1+APR/2)^2]-1

(1+0.17)=[(1+APR/2)^2]

APR=[(1+0.17)^(1/2)-1]*2

=16.33%(Approx).

Answer 2

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