Annual Compound Interest Calculation: "How would years 3 and 4 appear in the above?"
According to the information on compound interest at the following URL: http://www.moneychimp.com/articles/finworks/fmfutval.htm
"To find a formula for future value, We'll write P for your starting principal, and r for the rate of return expressed as a decimal. (So if the interest rate is 5%, r equals .05).
The balance will grow according to the following schedule:"
Year------------Balance
Now ------------P
1 ---------------P + rP
2---------------(P + rP) + r(P + rP)
3
4
How would years 3 and 4 appear in the above?
According to the information on compound interest at the following URL: http://www.moneychimp.com/articles/finworks/fmfutval.htm
"To find a formula for future value, We'll write P for your starting principal, and r for the rate of return expressed as a decimal. (So if the interest rate is 5%, r equals .05).
The balance will grow according to the following schedule:"
Year------------Balance
Now ------------P
1 ---------------P + rP
2---------------(P + rP) + r(P + rP)
3
4
How would years 3 and 4 appear in the above?
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