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    josephfrankel's Avatar
    josephfrankel Posts: 1, Reputation: 1
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    #1

    Jun 26, 2007, 10:15 AM
    Compound Interest
    If an investment is up 88% over 6 years (simple interest) what is the compound rate of growth per anum.

    My question was not for the purposes of homework.. I need the number for a real world reason. Unfortunately, I am very bad in math and could never figure out how to do this formula
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
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    #2

    Jun 26, 2007, 10:22 AM
    The formula for simple compound interest is:

    Where is the interest rate per year and is the number of years.
    Here you know that "Future Value" is 1.88 times the initial value, and N is 6 years. Can you now determine the value for i? It's easiest to solve this using logarithms.
    raaj's Avatar
    raaj Posts: 2, Reputation: 1
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    #3

    Aug 25, 2007, 03:41 AM
    What is the formula of compound interest
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