What is the formula used to calculate interest?

Question

Yeah, I need to know that

Answer 1

There are lots of different kinds of compoundings... If you are talking about, say, annual compounding, then if you put in A now, you are going to have A(1+r) in one year, where r is the interest rate. If you have daily compounding, then it's A(1+r)^365 after one year. If you compound CONTINUALLY, which would be your best deal, you'd have A*e^(r*y) after y years, where e is the mathematical constant (roughly 2.718).