Finance.Effect Method

FinanceEffect Method

Returns the effective annual interest rate.

Namespace: Imsl.Finance
Assembly: ImslCS (in ImslCS.dll) Version: 6.5.2.0

Syntax

public static double Effect(
	double nominalRate,
	int nper
)

Public Shared Function Effect ( 
	nominalRate As Double,
	nper As Integer
) As Double

public:
static double Effect(
	double nominalRate, 
	int nper
)

static member Effect : 
        nominalRate : float * 
        nper : int -> float

Parameters

nominalRate: Type: SystemDouble
A double which specifies the nominal interest rate.
nper: Type: SystemInt32
A int which specifies the number of compounding periods per year.

Return Value

Type: Double
A double which specifies the effective annual interest rate.

Remarks

The nominal interest rate is the periodically-compounded interest rate as stated on the face of a security. The effective annual interest rate is computed using the following:

$\left( {1 + {{\it nominalRate} \over {\it nper}}} \right)^{\it nper} - 1$

Reference

Finance Class

Imsl.Finance Namespace

Other Resources

Example