Functions
EFFECT
Effective annual interest rate
Try it
When to use it
When should I use EFFECT instead of the stated nominal rate?
Use EFFECT to find the true annual cost of a loan or yield of an investment once compounding is accounted for — always higher than the nominal rate when compounding is more frequent than annual.
Used in
finance · lending · personal-finance
Syntax
EFFECT(nominal_rate, npery)Examples
=EFFECT(0.99,12) // => 1.5890167507927813