Financial Applications Flashcards
1
Q
formula for compound interest
A
A = P (1 + i)n
2
Q
A
A
amount (what you end up with)
3
Q
P
A
principal (what you start with)
4
Q
i
A
interest rate per compounding period as a decimal
5
Q
n
A
number of compounding periods or number of interest calculations
6
Q
annually
A
1
7
Q
semi-annually
A
2
8
Q
quarterly
A
4
9
Q
monthly
A
12
10
Q
semi-monthly
A
24
11
Q
weekly
A
52
12
Q
bi-weekly
A
26
13
Q
daily
A
365
14
Q
formula for amount annuity
A
A = R [(1+i)2 -1] / I
R = A x I / (1+i)n -1
15
Q
A
A
amount time last payment Annuity
16
Q
R
A
regular payment at the end of each compounding period
17
Q
i
A
interest rate
18
Q
n
A
number of payments
19
Q
formula for present value of an ordinary annuity
A
PV = R[ 1- (1+i)-n] / I
R = PV x I / 1- (1+i)-n
20
Q
PV
A
present value
21
Q
R
A
payment made at the end of each compounding period
22
Q
i
A
interest rate per compounding period
