Compound Interest
Earnings that is seen as payment for an investment or a price to pay for borrowing a sum of money, in the case where the earnings are periodically added to the previous capital or balance.
- Compound interest is often expressed in the form of a percentage of the borrowed sum to which the previous interest have been added.
- La valeur Vn after n periods of an amount M invested at an interest rate t per period (a period being a duration at the end of which the interest is reinvested) is given by this relationship: [latex]V_n=M(1+t)^n[/latex].