ECONOMICS
COMPOUND INTEREST
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The interest formulas, whatdoes the t represent?
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Principle
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Interest
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Time
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Percent Rate
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Explanation:
Detailed explanation-1: -r = rate of interest. n = number of times interest is compounded per year. t = time (in years)
Detailed explanation-2: -t = number of years the amount is deposited or borrowed for. A = amount of money accumulated after n years, including interest.
Detailed explanation-3: -Simple Interest is calculated using the following formula: SI = P × R × T, where P = Principal, R = Rate of Interest, and T = Time period. Here, the rate is given in percentage (r%) is written as r/100. And the principal is the sum of money that remains constant for every year in the case of simple interest.
Detailed explanation-4: -When using the simple interest formula, time, t, is expressed in the same period as the rate.
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