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how to calculate compound interest repayments. Suppose Ravi took out a loan of 10000 for 4 years at 5 rate of interest and you need to calculate the compound interest and the amount payable at the end of the term. We will use the formula B5 12 12797 12 for the number of years to complete the loan repayment.
Compounding Interest Formulas Calculations Examples Video Lesson Transcript Study Com from study.com
Your intermediate accounting textbook may substitute n for time the n stands for number of periods time. Interest rates displayed are for prime loans under 80 LVR Funder loadings may apply to certain postcodes or high density locations or for other reasons please speak to your Personal Finance Manager for more details. Compound It Compound Frequency Annually Semiannually Monthly Daily.
Suppose Ravi took out a loan of 10000 for 4 years at 5 rate of interest and you need to calculate the compound interest and the amount payable at the end of the term.
The faster you pay back the principal the lower the interest amount will be. Range of interest rates above and below the rate set above that you desire to see results for. If in the above scenario the compounding period is every year then the compound interest will be Compound Interest P 1 rn nt P. Create an Excel document to compute compound interest.
