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Midterm Formulas

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8 views

Midterm Formulas

Uploaded by

55kqwtysn2
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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SIMPLE INTEREST FORMULAS:

 I = Prt simple interest


 P=I principal
rt
 r=I interest rate per period
Pt
 t=I time
Pr
 I= F- P or Interest
 P = F- I or Present Value or P = F
1 + rt
 F=P+I Future Value or F = P(1+rt)

ORINARY AND EXACT INTEREST:


 Io = Pr(days ) Ordinary interest (Banker’s Rule)
360
 Ie = Pr (days) Exact Interest
365

SIMPLE DISCOUNT FORMULAS:


 D = Fdt Simple discounts (Interest/discounts)
D= F-P
 F= P Maturity value
1-dt
 P = F (1-dt) Proceeds
 d= D rate of discounts
Ft
 t=D Time period
fd

COMPOUND INTEREST:
Compound Interest Formula Conversion Period/Interest
Period
Present value of compound
amount Conversion period refers to how
often the interest is calculated
 P = F (1+i) -n over the term of the loan or
investment.
 P= F
(1 + i )ⁿ m = 12 (monthly)
m = 4 (quarterly)
Where: m = 2 (semi-annually)
P = present value or principal m = 1 (annually)
F = Future Value m = 6 (bi-monthly)
i = rate per period (periodic
rate)
i = j/m
n = number of conversion
period
n = m(t)
t = time
j = nominal rate
m = conversion period

Compound Interest Formula Conversion Period/Interest


Period
Future value or compound
amount  Is the time between
successive conversions of
 F = P (1+i) n interest into principal

m = 12 (monthly)
m = 4 (quarterly)
Where: m = 2 (semi-annually)
F = future value m = 1 (annually)
i = rate per period (periodic m = 6 (bi-monthly)
rate)
i = j/m
n = number of conversion
period
n = m(t)
t = time
j = nominal rate
m = conversion period
Nominal rate of interest
I = antilog^(logF) – (logP) - 1
n
Finding unknown time
n = (log F) – (log P) or n = log (F/P)
log (1 + i) log (1 + i)
t = _n_
m

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