Computing effective annual rate (EAR)

Using a stated rate of 4.25%, compute EARs for semiannual, quarterly, monthly, daily and continuous compounding.

ear(0.0425, 2)

[1] 0.04295

ear(0.0425, 4)

[1] 0.04318

ear(0.0425, 12)

[1] 0.04334

ear(0.0425, 365)

[1] 0.04341

ear.continuous(0.0425)

[1] 0.04342