If the rate of interest is 20% per annum com-
pounded in every 6 months, then what is the
effective rate of interest per annum
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If the rate of interest is 20% per annum com-
pounded in every 6 months, then what is the
effective rate of interest per annum
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Answer is 6620.14
effective rate of interest = [1+(rate of nominal interest/compounding period)]^compounding period-1
[1+(20/6)]^(6)-1
[1+10/3]^(6)-1
[3/3+10/3]^(6)-1
[13/3]^(6)-1
6621.14-1 = 6620.14