September 15, 2009
No CommentsHow to Compound Your Money Continually
Description
A detailed tutorial on the solving of continuous compounding equations. Step by step tutorial including several examples of how to compound money continuously for reference.
Overview
Continuous compounding is slightly different than compound interest, in that the money is always being compounded - hence the name continuous compounding. Continuous compounding can be found by using the formula A = P * e^rt, which people sometimes remember by saying \”A is Pert.\” In this equation, A stands for the final amount, P stands for the principal (starting) amount, e is a number approximately equal to 2.71828, r stands for the interest rate, and t stands for the time in years.
