apr+vs+apy - 1,000.00 12% 4 (1+12%/4)^4 1,125.5088...

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Vocabulary APR Annual Percentage Rate is the periodic rate times the number of compounding periods in a year APY Annual Percentage Yield is the periodic rate compounded for a whole year EFF Effective Rate is the APY NOM Some calculators call the APR the NOMinal rate DPR Daily Periodic Rate (credit cards) APR versus APY Yearly APY or Beginning Compounding Compounding Ending Total Effective Balance APR Periods Factor Balance Interest Rate 1,000.00 12% 1 (1+12%) 1,120.0000 120.00000 12.0000% 1,000.00 12% 2 (1+12%/2)^2 1,123.6000 123.60000 12.3600%
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Unformatted text preview: 1,000.00 12% 4 (1+12%/4)^4 1,125.5088 125.50881 12.5509% 1,000.00 12% 6 (1+12%/6)^6 1,126.1624 126.16242 12.6162% 1,000.00 12% 12 (1+12%/12)^12 1,126.8250 126.82503 12.6825% 1,000.00 12% 365 (1+12%/365)^365 1,127.4746 127.47462 12.7475% 1,000.00 12% infinite e^(12%)(1) 1,127.4969 127.49685 12.7497% for continuous compounding the future value is present value times e^rt Most credit cards charge a daily periodic rate Days Per year 365 DPR 0.03287671% APR 12.0000% EFF 12.7475%...
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This note was uploaded on 02/09/2012 for the course MGT 3078 taught by Professor Marchman during the Spring '12 term at Georgia Institute of Technology.

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