Solution 11210: Formula for Converting Annual Percentage Rate (APR) to Annual Effective Rate (EFF) on the BA-35 Solar.
Why does converting Annual Percentage Rate (APR) to Annual Effective Rate (EFF) gives different answer than the formula on the BA-35 Solar?
The BA-35 Solar will return the same answer as the formula for Keff if the unit's decimal setting is set to display 2 places. The unit does not actually use formulas for calculating problems, as one would do by hand. In most instances, an algorithm is generated that solves a particular calculation (converting APR to EFF or vice versa) as well as time value of money (TVM) and other types of calculations. Often a single algorithm can be used in multiple settings and is usually much faster in doing more types of problems than using a formula. Therefore, the unit is not actually using a formula to calculate the APR -> EFF calculations but is using an algorithm that reaches the same means.Please see the BA-35 Solar Quick reference guide for additional information.