Single-Payment Compound-Amount (F/P)
The most straightforward of the six compound interest formulas is known as single-payment compound-amount. The name refers to the idea that a single payment is due at the end of the loan and that payment includes all of the compounded interest. A clear application of this formula is when some amount of money is put into a bank account at a fixed interest rate for some period of time. This formula can be used to calculate how much money will be in the account at the end of that time. Keeping in mind that putting money into a bank account is exactly like loaning that money to the bank, this same formula is used when a borrower gets an amount of money and repays the entire amount plus compound interest as a single ...
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