Annual percentage rate
Annual percentage rate (better known by its acronym, APR; alternatively known as annual interest rate, interest rate per year, interest rate earned per year; as symbols also referred as i, I, I/YR, and r; hereinafter, APR) is the nominal annual interest rate or, in other words, the rate of return calculated for a given year. In most cases, interest rate, lease rate, and rate of return mean APR as well.
Definitions
According to Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition),
- APR. The nominal annual interest rate is also called the annual percentage rate.
Description
ARP is what a lender charges a borrower or a borrower pays a lender. Usually, the borrowed resource is cash, building, car, or any other asset that the borrower needs and the lender has.
Related concepts
- Financial management. A combination of enterprise efforts undertaken in order to procure and utilize monetary resources of the enterprise.
