APY is short for annual percentage yield.
The annual percentage yield is the real rate of return earned on a savings deposit or investment taking into account the effect of compounding interest.
Formula to calculate APY.
i is the stated annual interest rate.
n is the number of compounding periods per year.
Example:
Suppose the annual interest rate is 5% and it is compounded semi-annually. Calculate the annual percentage yield.
Therefore, the annual percentage yield.
