Computation of Future value and the interest earned for each of the following compounding frequencies:
Future value = Present value*(1+i/m)^(n*m)
n - number of years
m - frequency of compounding in a year
i - rate of interest
Compound Interest = = P [(1 + i)n – 1]
P = Principal,
i = nominal annual interest rate in percentage terms
n = number of compounding periods.
N – time in years (for compound interest calculations) OR number of payments made during the term of the annuity (for annuity calculations)
I/Y – nominal annual rate of interest per year (entered as a %; NOT a decimal)
C/Y – number of interest compounding periods per year
P/Y – number of payment periods per year
PV – present value (the amount of money at the beginning of the transaction.)
PMT – Periodic deposit amount
FV – future value (money at the end of the transaction.).