Periodic compounding

Description

Compound interest is interest added to the principal of a deposit or loan so that the added interest also earns interest from then on. This addition of interest to the principal is called compounding.The amount function for compound interest is a power law function in terms of time.

Related formulas

Variables

AtThe amount after t periods (dimensionless)
A0The initial amount (dimensionless)
rNominal annual interest rate expressed as a decimal. (dimensionless)
nNumber of compounding periods per year (dimensionless)
tTotal time in years (dimensionless)