What is the equivalent monthly interest rate?
If 23% is compounded each month, there will be 12 intervals and then the monthly rate is:
23 ÷ 12 = 1.92 %
If 23% is compounded annually, then the monthly rate would be:
Rate = (1 + 23%)⁰°⁸³³ (power is 0.833 or 1/12)
= 1.23⁰°⁸³³ (power is 0.833 or 1/12)
= 1.0174 - 1 x 100
= 1.74 %
