A the future value of the investmentloan including interest P the principal investment amount the initial deposit or loan amount r the annual interest rate decimal n the number of times that interest is compounded per unit t t the time the money is invested or borrowed for. In this post. A P 1 r n n t A 1 000 000 1 06 12 12 5 A 1 000 000 1 0005 12 5 A 1 000 000 1005 60 A 1 348 85015.
To reach the formula for compound interest you algebraically rearrange the formula for CAGR.
T the number of periods the money is invested for. Calculating Compound Interest on Investments 1. The interest rate and number. The compound interest formula is A P1rn to the power of nt Compounding Interest Pros and Cons.