What is compound interest and how do you find compound interest?
To find the final value of an investment use this compound interest
Investment Value = P x ( 1 + r/n )(Y x n)
P = Principal Value
r = Yearly Interest Rate in decimal form ( example: 5% in decimal form
is .05 )
Y = Life of the investment in years
n = how many times per year the interest is compounded
Example: An original investment of $5,000 held for 3.5 years at an
interest rate of 5% would result in the following values.
If compounded yearly, the investment value would be:
Investment Value = $5,000 x ( 1 + .05/1)(3.5 x 1)
Investment Value = $5,931.06
The same investment compounded weekly would result in:
Investment Value = $5,000 x ( 1 + .05/52 )(3.5 x 52)
Investment Value = $5,955.73
Win $100 towards teaching supplies! We want to see your websites and blogs.
We use your calculator ideas to create new and useful online calculators.
Submit Calculator Idea