# Calculating APR

• January 19th 2011, 04:57 PM
Shapeshift
Calculating APR
8% APR compounded semi-annually equals ______ APR compounded annually

a) 7.85 %
b) 8.16 %
c) 8.81 %
d) 7.92 %
e) 8.01 %

I am not sure how to calculate this, and am not sure of what formula to use. Any help would be appreciated.
• January 19th 2011, 05:38 PM
dwsmith
Quote:

Originally Posted by Shapeshift
8% APR compounded semi-annually equals ______ APR compounded annually

a) 7.85 %
b) 8.16 %
c) 8.81 %
d) 7.92 %
e) 8.01 %

I am not sure how to calculate this, and am not sure of what formula to use. Any help would be appreciated.

$\displaystyle \text{EAR}=\left(1+\frac{i}{n}\right)^n-1$
• January 19th 2011, 06:09 PM
Shapeshift
I got 8.16%. Thanks!!