Daily Compounding:FV = $10,000 x (1 + (15% / 365))(365 x 1)= $11,617.98 Continuous Compounding:FV = $10,000 x 2.7183(15% x 1)= $11,618.34 With daily compounding, the total interest earned is $1,617.98, while with continuous compounding the total interest earned is $1,618.34,...
LITTLE DIFFERENCE IN DAILY AND CONTINUOUS COMPOUNDINGBeatson Wallace
Compounding Interest | Formula, Types & Examples from Chapter 16 / Lesson 8 329K Review the definition of compound interest. Use the compound interest formula in daily, monthly, quarterly, and annual compound interest example calculations. ...
This formula works as long as “r” and “n” refer to the same time period. It could be years, months, or days — though in most cases, we’re considering annual interest. There’s no trickery because there’s no compounding — interest can’t grow. Simple interest is useful when: ...