Problems with annual interest rate

blueraven82
Posts: 1
Joined: Fri Nov 16, 2012 2:58 pm

Problems with annual interest rate

Postby blueraven82 » Fri Nov 16, 2012 3:02 pm

I have a query with finding the annual interest rate. In the questions the PV & FV are given & it is mentioned that it is compounded monthly, quarterly etc. e for period of x. The annual interest rate has to found out.

The formula in the notes is give as (1+I/Y)^12-1. But the answer does not tally.

Please help.

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pankaj
Finance Junkie
Posts: 61
Joined: Fri Aug 03, 2012 11:24 am

Re: Problems with annual interest rate

Postby pankaj » Sat Nov 17, 2012 1:04 pm

Formula is correct, problem is with the options given for the question.

you can even get the answer using financial calculator.

Hope this helps!


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