Compound Interest Formula

Compound Interest

Formula

Summary

The compound interest formula calculates the total accumulated value of a principle amount after time has elapsed with compounding interest. Normally, compound interest is computed iteratively, while this formula calculates the continuous growth taking into accound the time elapsed and frequency of investment.

Expression Description
Accumulated amount
Principle amount
Rate of interest
Frequency of investment
Time elapsed

Usage Notes

The compound interest formula calculates the growth of an initial value whos interest compounds over time. For example, to calculate the total value of an initial amount of , with an interest rate of , a quarterly frequency of investment ( times a year) and a time elapsed of years the formula would be: