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Hi,
I am not sure, if it is a correct place to post tis. But still, i hope i will be getting good help from this forum. I am very lazy to do maths calculation. But, I need to learn and do it atleast to square average marks. I have been given some problems on compound and simple interest. Simple interest is somewhat easy, but feeling difficult of CI calculations. Someone help me with some online resources to calculate it.
Have you watched the free lecture on Interest in the Paper F2 section of this website??
Dear cathy, always google is there to help you…Learn how to calculate it and use it. Simply dont depend on some online calculators. Try it on your own, and use those things for your reference. https://www.easycalculation.com/compound-interest.php
Compound Interest Method
New balance = Principal x [(1 + rate) raised to the power of time]
P(n) = P(0)*(1+r)^n
Principal, P(0) is the money invested
Rate, r = the periodic rate e.g. 12% per annum or 12% per year i.e. 0.12
n = time, which may be days, months, years (but usually either month or years)The interest portion would be P(n) – P(0)
So as an example, what is the interest on $100 invested for 5 years at 12% per annum
P(5) = 100*(1+0.12)^5
P(5) = 100*1.12^5
P(5) = 100*1.7623
P(5) = 176.23Thus interest = 176.23 – 100 = $76.23
Another example using the same scenario above but the interest is 12% per annum paid semiannually (twice per year) for 5 years
P(0) = 100
r = 12%/2 = 6% or 0.06
n = 5*2 = 10 paymentsP(10) = 100*(1+0.06)^10
P(10) = 100*1.06^10
P(10) = 100*1.7908
P(10) = 179.08Thus interest = 179.08 – 100 = $79.08
So what is a “power”?
When I wrote 1.12^5, that is the same as saying 1.12 x 1.12 x 1.12 x 1.12 x 1.12. There is a function on the calculator which simplifies that computation. On some it looks like “^” while on others it is a “y” with a small “x” in the top right hand corner.Hope this helps.
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