Quick question

Numpty_2

I know someone posted this yesterday but can I find the thread in question?

Can you tell me the APR for monthy rate of 1.167% please

Numpty_2

And what 1.456% is please

CLAPTON

1.167% per month is 14.939% APR
1.456% per month is 18.431% APR

Hello

Hi Clapton

Would you mind sharing how that it done? I would like to figure out 1.313%.

Hello.

CLAPTON

its good if you have excel to actually do the calculation


firstly the maths

if x is the monthly interest rate expressed as a %

then the APR is ( (1+x) power 12 )minus 1

if you use excel then

write in a cell =power(1+x,12)-1 and format the cell as percentage
and x is FORMAT percenatge

but frankly multiplying by 13 gives a good approximation (and a lot easier)

moozie_2

Here's an example of how it works that I was given over at the credit card board a little while ago...

1.2408% per month means that £100 becomes £101.24....

Over two months it becomes 1.012408 x £101.24, or £102.50...

Over 12 months (continuing for another 10 months) £102.50 becomes £115.95

So over 12 months the orginal £100 has increased by £15.95 and the APR is then just:

£15.95 / £100.00 x 100% = 15.95%

Which they usually shorten to '15.9 APR'

HTH