Tag: compound

Rule of 72

The rule of 72 is an approximation tool used to determine the amount of time it will take for money to double on the earnings of compound interest. Rule of 72 Explained The rule of 72 is essentially an estimation for determining the amount of years or the doubling time of an investment. Do this

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Interest Expense Formula

Interest Expense Formula Interest expense calculations involve 4 parts: Principal, Rate, Time, and Compounding. Use the following formula to calculate simple interest expense (which excludes compounding): Interest Expense = Principal X Rate X Time To calculate the compound interest rate, use the following formula: Principal X (1+ (R / N))(N X T) Where: R =

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Effective Rate of Interest Calculation

See Also: What is Compound Interest When is Interest Rate Not an Important in Selecting a Loan? Nominal Interest Rate Interest Rate Swaps Fixed Interest Rate vs Floating Interest Rate Effective Rate of Interest Calculation Definition An effective rate of interest calculation is the actual cost of a loan. It is the total amount of interest

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Bank Charge

See Also: Fixed Charge Coverage Ratio Analysis 5 C’s of Credit (5 C’s of Banking) SKU Categories of Banks Bank Charge Definition Bank charge, defined as the fees associated maintaining a bank account, exist in the personal as well as business world. These charges come from two factors. First, regular account maintenance is perhaps the

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Annual Percent Rate (APR)

See Also: Effective Rate of Interest Calculation Fixed Interest Rate vs Floating Interest Rate Interest Expense Carried Interests Annual Interest Rate Definition The Annual percentage rate (APR) of a loan is the yearly interest rate expressed as a simple percentage. A bank or lender quotes the rate or APR. The annual percent rate does not incorporate

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