Manuals/calci/NOMINAL

NOMINAL(ER, nperyear)

Where

• $ER$ is the effective interest rate, and
• $nperyear$ is the number of compounding periods per year.

NOMINAL() calculates the nominal annual interest rate.

Description

NOMINAL(ER, nperyear)

• 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 -

Failed to parse (MathML with SVG or PNG fallback (recommended for modern browsers and accessibility tools): Invalid response ("Math extension cannot connect to Restbase.") from server "https://wikimedia.org/api/rest_v1/":): {\displaystyle ER = \frac{1 + \frac{Nominal_Rate}{nperyear}}^(nperyear) - 1}
 

where ER - Effective Interest Rate

     Nominal_Rate - 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.

Examples

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

5.75%
5

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

See Also

• INTRATE

References

• Nominal Interest Rate
• Effective Interest Rate