Thanks to visit codestin.com
Credit goes to www.scribd.com

Scribd
Upload
327 views13 pages

Lesson 27: Finding Interest Rate and Time in Compound Interest

This document provides examples for calculating compound interest rates, time periods, and interest earned over time. It demonstrates how to find the number of periods, interest rate per conversion period, and equivalent nominal and effective rates for different compounding frequencies. Examples show calculating time to reach a target amount, interest earned over time at a given rate, and determining rates that will double an investment over 10 years when compounded quarterly or semi-annually.

Uploaded by

Jared Criss F. Pelayo
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
327 views13 pages

Lesson 27: Finding Interest Rate and Time in Compound Interest

This document provides examples for calculating compound interest rates, time periods, and interest earned over time. It demonstrates how to find the number of periods, interest rate per conversion period, and equivalent nominal and effective rates for different compounding frequencies. Examples show calculating time to reach a target amount, interest earned over time at a given rate, and determining rates that will double an investment over 10 years when compounded quarterly or semi-annually.

Uploaded by

Jared Criss F. Pelayo
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
You are on page 1/ 13

Lesson 27: FINDING INTEREST RATE

AND TIME IN COMPOUND INTEREST


Finding the Number of Periods n, for Compounded
Interest.
Example 1

How long will it take P3,000 pesos to accumulate to P3,500 in a bank savings
account at 0.25% compounded monthly?
Example 2

How long will it take to P1,000 to earn P3,000 if the interest is 12%
compounded semi-annually?
FINDING THE INTEREST RATE, j
PER CONVERSION PERIOD
Example 3

At what nominal rate compounded semi- annually will


P10,000 accumulate to P15,000 in 10 years?
Example 4

At what interest rate compounded quarterly will money double


itself in 10 years?
Definition of Terms
Equivalent rates- two annual rates with different conversion
periods that will earn the same maturity value for the same time or
term.

Nominal rate- annual interest rate( maybe compounded once a


year).

Effective rate- rate when compounded annually will give the same
compound each year with the nominal rate.
Example 5

What effective rate is equivalent to 10% compounded quarterly?

You might also like