ECONOMICS
COMPOUND INTEREST
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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P= P o + P o ^rt
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P= Po (1+r/n) ^nt
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Either A or B
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None of the above
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Detailed explanation-1: -When interest is compounded a given number of times per year use the formula A(t)=P(1+rn)nt. When interest is to be compounded continuously use the formula A(t)=Pert. Doubling time is the period of time it takes a given amount to double.
Detailed explanation-2: -Compound interest, can be calculated using the formula FV = P*(1+R/N)^(N*T), where FV is the future value of the loan or investment, P is the initial principal amount, R is the annual interest rate, N represents the number of times interest is compounded per year, and T represents time in years.
Detailed explanation-3: -Using the interest rate formula, we get the interest rate, which is the percentage of the principal amount, charged by the lender or bank to the borrower for the use of its assets or money for a specific time period. The interest rate formula is Interest Rate = (Simple Interest × 100)/(Principal × Time).