Let be the Principal (initial investment), be the annual compounded rate, the ``nominal rate,''
be the number of times Interest is compounded per year (i.e., the year is divided into Conversion
Periods), and be the number of years (the ``term''). The Interest rate per Conversion
Period is then
(1) |
(2) |
(3) |
(4) |
The time required for a given Principal to double (assuming Conversion Period) is given by solving
(5) |
(6) |
(7) |
See also e, Interest, Ln, Natural Logarithm, Principal, Rule of 72, Simple Interest
References
Kellison, S. G. The Theory of Interest, 2nd ed. Burr Ridge, IL: Richard D. Irwin, pp. 14-16, 1991.
Milanfar, P. ``A Persian Folk Method of Figuring Interest.'' Math. Mag. 69, 376, 1996.
© 1996-9 Eric W. Weisstein