How to Calculate Add on Rate?
Add on Rate calculator uses Add on Rate = ((Year/Days)*((Amount Paid at Maturity Including Interest)-Present Value of Money Market Instrument)/(Amount Paid at Maturity Including Interest)) to calculate the Add on Rate, Add on Rate calculates interest based on the initial principal for the full term of the loan or investment, rather than on the remaining balance as it reduces over time. Add on Rate is denoted by AOR symbol.
How to calculate Add on Rate using this online calculator? To use this online calculator for Add on Rate, enter Year (YR), Days (d), Amount Paid at Maturity Including Interest (APMI) & Present Value of Money Market Instrument (PV) and hit the calculate button. Here is how the Add on Rate calculation can be explained with given input values -> 0.388889 = ((7/15)*((210)-35)/(210)).