Finance

Compound Interest

A = P(1 + r/n)^n^t

  • P: principal amount (initial investment)
  • r: annual interest rate (as a decimal)
  • n: number of times the interest is compounded per year
  • t: number of years
  • A: amount after time t

Future value of a Present Amount

FV = PV(1 + i)^n

  • FV: Future Value
  • PV: Present Value
  • i: the interest rate compounded for each period of time
  • n: the number of payment periods
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