$\$1$ today $\rightarrow$ ? in one year
$(1+0.02)$ $\times(1+0.02)$ $\times(1+0.02)$$\times(1+0.02)$$=1.0824$
$(1+r_{q})$ $\times(1+r_{q})$$\times(1+r_{q})$$\times(1+r_{q})$$= 1 + r_a$
$(1+r_{q})$ $\times(1+r_{q})$$\times(1+r_{q})$$\times(1+r_{q})$$= 1 + r_a$
$r_a=(1+r$$_{\frac{1}{m}}$ $)^m-1$ = $(1+r$$_{\frac{1}{365}}$ $)^{365}-1$
A more accurate rate of interest:
Fisher Effect:
$1+R = (1+r)\times(1+h)$