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Interest rate (R)
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The interest rate (R) is expressed as percentage (%) per interest period.
The interest rate may contain max two digits after its decimal point.
The interest rate entered may contain a comma (,) or point (.) as a decimal point separator.
Correct entered interest rates
5.25
5,25
4
Incorrect entered interest rates
5.041
You can choose between the following interest periods:
- day
For example: 4.5% per day
Every day the interest will be calculated on the principal amount for the specified time period (T).
- week
For example: 4.5% per week
Every week the interest will be calculated on the principal amount for the specified time period (T).
- two weeks
For example: 4.5% per two weeks
Every two weeks the interest will be calculated on the principal amount for the specified time period (T).
- half month
For example: 4.5% per half month
Every half month the interest will be calculated on the principal amount for the specified time period (T).
- month
For example: 4.5% per month
Every month the interest will be calculated on the principal amount for the specified time period (T).
- two months
For example: 4.5% per two months
Every two months the interest will be calculated on the principal amount for the specified time period (T).
- quarter
For example: 4.5% per quarter
Every quarter the interest will be calculated on the principal amount for the specified time period (T).
- half year
For example: 4.5% per half year
Every half year the interest will be calculated on the principal amount for the specified time period (T).
- year
For example: 4.5% per year
Every year the interest will be calculated on the principal amount for the specified time period (T).
The interest rate (R) and time period (T) should be in the same time units such as weeks, months, years etc.
If they differ the calculator will adjust the time period accordingly.
Example 1: How time period will be adjusted:
Interest rate = 5% per month
Time period = 7 weeks
52 weeks equals 12 months equals 1 year
Thus 7 weeks equals (7*12)/52 = 1.615384 months
Example 2: How time period will be adjusted:
Interest rate = 5% per two weeks
Time period = 2 quarters
4 quarters equals 26 two weeks equals 1 year
Thus 2 quarters equals (2*26)/4 = 13 two weeks
Example 3: How time period will be adjusted:
Interest rate = 5% per half year
Time period = 2 half months
24 half months equals 2 half years equals 1 year
Thus 2 half months equals (2*2)/24 = 0.166667 half year
The simple interest equation:
FV = P + I
I = P * R * T
FV = P + P * R * T
P * R * T = FV - P
R = (FV - P) / (P * T)
where:
FV = Future value
I = Interest amount
P = Principal amount
R = Interest rate (as a decimal, not in percentage)
T = Time period
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