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Interest calculated only on original principal amount
I=PRnI = PRnI=PRn
Interest on principal plus accumulated interest
An=P(1+R)nA_n = P(1 + R)^nAn=P(1+R)n
An=P(1−R)nA_n = P(1 - R)^nAn=P(1−R)n
Per annum (per year)
Linear growth / arithmetic sequence
Exponential growth / geometric sequence
Divide by 100
Rate and time period must use same units
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