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formula for compound interest method. To calculate compound interest use the formula below. The formula for compound interest that is compounded multiple times per year is.
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The process has been simplified because of the equation that can easily help you in arriving at the result. This is a much quicker method. A Future Value of the investment 1600 P Initial value of investment 1000 r rate of return to be calculated m number of the times compounded yearly 1 t number of years for which investment is done 10 years.
Compound Interest Formula The formula for the Compound Interest is This is the total compound interest which is just the interest generated minus the principal amount.
As you move from year to year the principal amount continues to grow. A Compound amount P Principal amount i rate of interest n number of periods. Rate of interest for half year R 2. If interest is compounded half yearly then the rate of interest also needs to be divided by 2 is the given rate of interest is for per annum.
