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in this video Iamp;#39;m going to talk about how you can calculate the effective annual rate of interest using a very simple formula now if youamp;#39;re interested in finding out what the effective annual rate of interest is or E for short and how it pertains to the stated rate of interest and the differences then I suggest that you check out the other video which is more conceptual but here Iamp;#39;m just going to talk about the formula for calculating the E when youamp;#39;re given a few things and what youamp;#39;re going to need to know is youamp;#39;re going to need to know the number of compounding periods which weamp;#39;ll call n so compounding periods so if you compound quarterly for one year then thatamp;#39;d be four periods for example and then youamp;#39;re also going to need to know the stated rate of interest which is I stated rate of interest and when you have these things weamp;#39;ve got a really nice simple formula thatamp;#39;s going to allow you to Out