Under this formula, you can manipulate 't' to calculate interest according to the actual period. P = Principal amount or the original balance.You may also see the simple interest formula written as: Our calculator will compute any of these variables given the other inputs. Simple Interest = Principal Amount × Interest Rate × Time The basic simple interest formula looks like this: In other words, future interest payments won't be affected by previously accrued interest. No matter how often simple interest is calculated, it only applies to this original principal amount.
Generally, simple interest is set as a fixed percentage for the duration of a loan. Simple interest is interest that is only calculated on the initial sum (the 'principal') borrowed or deposited. You might pay interest on an auto loan or credit card, or receive interest on cash deposits in interest-bearing accounts, like savings accounts or certificates of deposit (CDs). Interest is the cost you pay to borrow money or the compensation you receive for lending money. Related Interest Calculator | Compound Interest Calculator
