Stated annual interest rate

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Stated annual interest rate

The interest rate expressed as a per year percentage, by which interest payments are determined. See: Annual percentage rate.

Stated Annual Interest Rate

An interest rate in a given year that does not account for more frequent compounding. For example, if a loan of $100 has a stated annual interest rate of 5%, the amount owed at the end of the year is $105. However, if the interest compounds monthly, the actual amount is $105.12. See also: Effective annual interest rate.