Formula for EFFECT Function Incorrect in Help

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Article ID: 149232 - View products that this article applies to.
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SYMPTOMS

In the versions of Microsoft Excel listed above, the online Help entries for the EFFECT and NOMINAL functions state that EFFECT is calculated using the following formula:
   EFFECT = ( 1 + Nominal_Rate / Npery ) ^ ( Npery - 1 )
				

MORE INFORMATION

This information is incorrect. The function is actually calculated using this formula:
   EFFECT = ( ( 1 + Nominal_Rate / Npery ) ^ Npery ) - 1
				
For more information about the EFFECT function, click the Index tab in Microsoft Excel Help, type the following text
EFFECT
and then double-click the selected text to go to the "EFFECT" topic.

Properties

Article ID: 149232 - Last Review: September 30, 2013 - Revision: 1.3
APPLIES TO
  • Microsoft Excel 95a
  • Microsoft Excel 5.0c
  • Microsoft Excel 5.0a for Macintosh
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