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    rahman2008's Avatar
    rahman2008 Posts: 1, Reputation: 1
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    #1

    Nov 12, 2008, 05:47 PM
    Apr vs Ear what is the difference
    Would you please share with me the interest rate calculations for the apr and the ear. Why do they differ? Aren't interest rates just interest rates?
    codyman144's Avatar
    codyman144 Posts: 544, Reputation: 31
    Senior Member
    		  
    #2

    Nov 12, 2008, 10:53 PM

    Effective interest rate - Wikipedia, the free encyclopedia

    Annual percentage rate - Wikipedia, the free encyclopedia

    They are quite different but simply put I think the EAR factors in the number of compunding periods where APR does not. There are more differences then this but that is a start.
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