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Finance Formulas / July 18, 2018 / Chanel Cleveland

Annual percentage rate (APR) is the annualized interest rate on a loan or investment which doesn’t account for the effect of compounding. It is the annualized form of the periodic rate which when applied to a loan or investment balance gives the interest expense or income for the period. In most cases it is the interest rate quoted by banks and other financial intermediaries on various products i.e. loans, mortgages, credit cards, deposits, etc. It is also called the nominal annual interest rate or simple interest rate.

The current ratio is a liquidity ratio that measures a company's ability to pay short-term and long-term obligations. To gauge this ability, the current ratio considers the current total assets of a company (both liquid and illiquid) relative to that company’s current total liabilities.

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