Revision as of 09:59, 18 February 2014

NOMINAL(ER, nperyear)

Where

NOMINAL() calculates the nominal annual interest rate.

Nominal Interest Rate is calculated depending on the effective interest rate and the number of compounding periods per year.
The relationship between Effective Interest Rate and Nominal Interest Rate is as follows -

$ER=(1+{\frac {NominalRate}{nperyear}})^{nperyear}-1$

where

$NominalRate$ - Nominal Interest Rate

$nperyear$ - number of compounding periods per year

Arguments $ER$ and $nperyear$ should be numeric, else Calci returns #N/A error message.
If $ER$ < 0 or if $nperyear$ < 1, Calci returns #N/A error message.
If $nperyear$ is not an integer, it is truncated.

Consider the following example that shows the use of NOMINAL function:

=NOMINAL(A1,A2) displays 0.05622136652263632 as a result.
=NOMINAL("6.10%",6) displays 0.05950499347618399 as a result.

@@ Line 14: / Line 14: @@
 *The relationship between Effective Interest Rate and Nominal Interest Rate is as follows -
- <math>ER = \frac{1 + \frac{Nominal_Rate}{nperyear}}^(nperyear) - 1</math>
+<math> ER = (1 + \frac{NominalRate}{nperyear})^{nperyear} - 1 </math>
-where ER - Effective Interest Rate
+where
+*<math>ER</math> - Effective Interest Rate
-      Nominal_Rate - Nominal Interest Rate
+<math>NominalRate</math> - Nominal Interest Rate
-      nperyear - number of compounding periods per year
+<math>nperyear</math> - number of compounding periods per year
 *Arguments <math>ER</math> and <math>nperyear</math> should be numeric, else Calci returns #N/A error message.
 *If <math>ER</math> &lt; 0 or if <math>nperyear</math> &lt; 1, Calci returns #N/A error message.