What is the effective interest rate of 8% compounded quarterly?
Effective rate =[ 1 + i/n]^n, where i =APR and n = Number of compounding periods
Effective rate =[1 + 0.08 / 4]^4
=[ 1.02]^4
= 1.08243216 -1 x 100 =8.243216% - Effective annual rate
