Given annual interest rate r_ann and n compounds per year, why do we use the formula
(1+r_ann/n)^tn
rather than (1+r)^tn
given r = (1+r_ann)^(1/n) - 1
.
Given annual interest rate r_ann and n compounds per year, why do we use the formula
(1+r_ann/n)^tn
rather than (1+r)^tn
given r = (1+r_ann)^(1/n) - 1
.