Finance: Compound interest

Everything You Need in One Place

Homework problems? Exam preparation? Trying to grasp a concept or just brushing up the basics? Our extensive help & practice library have got you covered.

Learn and Practice With Ease

Our proven video lessons ease you through problems quickly, and you get tonnes of friendly practice on questions that trip students up on tests and finals.

Instant and Unlimited Help

Our personalized learning platform enables you to instantly find the exact walkthrough to your specific type of question. Activate unlimited help now!

Get the most by viewing this topic in your current grade. Pick your course now.

?
Examples
Start Watching
Lessons
  1. Bianca deposits $1,000 in a savings account with an annual interest rate of
    12%. How much money will she have in 20 years, if the interest is compounded:
    1. daily
    2. monthly
    3. quarterly
    4. semi-annually
    5. annually
  2. A $1000 investment, compounded quarterly, doubles in value over a period
    of 8 years. Find the interest rate per annum.
    Free to Join!
    StudyPug is a learning help platform covering math and science from grade 4 all the way to second year university. Our video tutorials, unlimited practice problems, and step-by-step explanations provide you or your child with all the help you need to master concepts. On top of that, it's fun - with achievements, customizable avatars, and awards to keep you motivated.

    • Easily See Your Progress

      We track the progress you've made on a topic so you know what you've done. From the course view you can easily see what topics have what and the progress you've made on them. Fill the rings to completely master that section or mouse over the icon to see more details.

    • Make Use of Our Learning Aids

      Last Viewed
      Practice Accuracy
      Suggested Tasks

      Get quick access to the topic you're currently learning.

      See how well your practice sessions are going over time.

      Stay on track with our daily recommendations.

    • Earn Achievements as You Learn

      Make the most of your time as you use StudyPug to help you achieve your goals. Earn fun little badges the more you watch, practice, and use our service.

    • Create and Customize Your Avatar

      Play with our fun little avatar builder to create and customize your own avatar on StudyPug. Choose your face, eye colour, hair colour and style, and background. Unlock more options the more you use StudyPug.
    Topic Notes
    ?
    Now that we understand the concepts behind exponential growth and decay, let's utilize them and solve real-life problems! One of the many areas where exponential growth comes in handy is Finance. In this section, we will learn how compound interest helps us grow our deposits in our investment and/or bank accounts.
    exponential growth/decay: Af=Ai(1+rn)nt { A_f = A_i (1+\frac{r}{n})^{nt}}

    Af {A_f} : final amount
    Ai {A_i} : initial amount
    r {r} : Annual interest rate
    t {t} : total time given in years
    n {n} : number of times compounded in a year, if

    Compound daily:

    n = 365

    Compound monthly:

    n = 12

    Compound quarterly:

    n = 4

    Compound semi-annually:

    n = 2

    Compound annually:

    n = 1

    Basic Concepts
    ?
    Related Concepts
    ?