Compound Interest
Compound interest (or compounding interest) is the interest calculated on the principal, including all cumulative interest on deposits or loans in the previous period. – Investopedia
Logic
To calculate compound interest we have to use a very simple formula shown below:
Compound interest formula
Where, P = Principle T = Time and R = Rate
To calculate compound interest we have to multiply principle amount with the power of (1 + Rate / 100) with time as an exponent. To calculate power we have used pow() function of the module Math.
Program
# Import math module for 'Pow' function import math # Take input from user (Principal, rate, time) principal = float(input("Enter principal : ")) rate = float(input("\nEnter rate : ")) time = float(input("\nEnter time (year) : ")); # Calculate compound interest result = principal * math.pow((1 + rate / 100), time) ''' The pow(x, y) is equivalent to: x**y ''' # Print the result print("\nCompound interest :", result)
Output
Enter principal : 100
Enter rate : 25
Enter time (year) : 6
Compound interest : 381.4697265625