I need to calculate the nominal and effective interest rates on a 5-year loan where interest is paid quarterly at a rate of 3-month LIBOR plus a fixed spread. The loan is set up so the floating rate resets each quarter. Would the nominal rate be as follows? Q1 = (LIBOR + Spread)/4 Q2 = (LIBOR + Spread)/4 Q3 = (LIBOR + Spread)/4 Q4 = (LIBOR + Spread)/4 Nominal = Q1 + Q2 + Q3 + Q4 Would the effective rate then be (1+ Nominal/4)^4 - 1?