Roi The annual rate of interest for the amount borrowed or deposited. This formula applies when interest is earned on an annual basis and the interest is earned once a year. The compound interest formula contains the annual percentage yield formula of This is due to the annual percentage yield calculating the effective rate on an account based on the effect of compounding.
The compound interest formula is as follows.
The formula used in the compound interest calculator is A P 1rnnt A the future value of the investment P the principal investment amount. Y The number of years the principal amount has been borrowed or deposited. If the interest on your investment is paid quarterly while being quoted as an annual interest rate the Excel compound interest formula becomes. R Rate of interest.