Excel University Blog
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NOMINAL
When it comes to understanding the true cost of borrowing, we can’t afford to rely solely on advertised rates. Terms like APR (Annual Percentage Rate) and APY (Annual Percentage Yield) might seem interchangeable, but they tell very different stories due to compounding. With Excel’s built-in financial functions like NOMINAL, EFFECT, PMT, and RATE, we can…
Understanding interest rates is key to accurate financial modeling in Excel. In this guide, we’ll explore the NOMINAL function, which helps us convert an effective rate (APY) into a nominal rate (APR). Once we make this conversion, we can generate more precise projections using Excel’s other financial functions like FV (Future Value) and PMT (Payment).…