# Section 15: Savings; Nominal Rate Converted To Effective Rate - HP 12C Platinum Owner's Handbook Manual

And problem-solving guide.

### Nominal Rate Converted to Effective Rate

Given a nominal interest rate and the number of compounding periods per year,
this keystroke procedure computes the effective annual interest rate.
1. Press gÂ and fCLEARG.
2. Key in the annual nominal rate as a percentage, then press \.
3. Key in the number of compounding periods per year, then press nz¼.
4. Key in 100 then press Þ\\$.
5. Press M+ to obtain the effective annual interest rate.
Example 1: What is the effective annual interest rate if the annual nominal rate
of 5¼% is compounded quarterly?
Keystrokes (RPN mode)
fCLEARG
5.25\
4nz¼
100Þ\
\$M+
For repeated calculations, the following HP 12C Platinum program can be used:
KEYSTROKES
(RPN mode)
f]
fs
000,
f
000,
CLEAR
Î
001,
f
002,
CLEAR
G
n
003,
z
004,
Section 15
Savings
Display
Nominal rate.
5.25
Percent quarterly interest rate.
1.31
Percent effective interest rate.
5.35
KEYSTROKES
DISPLAY
(RPN mode)
0
0
Þ
\
43
8
\$
42
34
M
11
+
10

157
DISPLAY
007,
008,
009,
16
010,
36
011,
13
012,
15
013,
40
0
0