An annual interest rate of 4.75% but the catch is that the interest is accruing on a DAILY basis.
So out of curiosity I decided to calculate the daily interest rate.
Let the daily rate be x
so [4.75 / 100 ] [9040] = ( [x]^{365} ) [9040]
solve for x, we get x = 0.000127 %
Don't know whether I'm correct or not.
Readers please contribute.
Readers please contribute.
1 comment:
Don't think so. An annual rate of 4.75% can simply be divided by 365 or the more commonly used 360 for the daily interest rate. Using the accrual method for an annual rate of 4.75% gives you an effect annual rate of 4.8643%.
(1+0.0475/360)^360 = 1.048643
Post a Comment