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Can someone explain compound interest, quarterly, and continuously please?
 May 30, 2012
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I'm not familiar with the term 'continuously', but I'm going to assume that it means 'daily'.

When you are looking at compound interest, words like 'quarterly' are referring to the frequency of compound periods in a year (how often interest is added to your principal).
Interest, in compound interest calculations, is divided by the compound frequency (assuming your interest % is an annual rate).

Annually --> Once per year. i/1
Semi (Semi-annually) --> Twice per year. i/2
Quarterly --> Four times a year. i/4
Monthly --> Twelve times a year. i/12
Biweekly --> 26 times a year. i/26
Weekly --> 52 Times a year. i/52
Daily --> 365 times a year. i/365

Similarly, you could be given a more specific number of compound periods (eg: 98 times a year) in which case you would simply divide the interest rate by the specified value.

So, if you have $1000 and are given a 5%/a interest rate, compounded monthly for 10 years, you have:
[input]A=1000(1+0.05/12)^(10*12)[/input]
 May 30, 2012

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