EAR=[(1+APR/m)^m]-1
where m=compounding periods
=[(1+0.1885/365)^365]-1
which is equal to
=20.74%(Approx).
You plan to apply for a loan from Bank of America. The nominal annual interest rate...
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You plan to apply for a loan from Bank of America. The nominal annual interest rate for this loan is 15.31 percent, compounded daily (with a 365-day year). What is the effective annual rate, or EAR (annual percentage yield), of this loan? Please show work. I don't under how to use the ^ in the formula/equation.
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