Compound Interest Calculator Quarterly
Compound Interest Calculator Quarterly is a free tool that helps to find final interest on the given amount, rate and time period if compounded quaterly.
What is a Compound Interest Calculator Quarterly?
Compound Interest Calculator Quarterly is an online tool that finds the compound interest for a given principal amount on a quarterly basis. 'Cuemath's Compound Interest Quarterly Calculator' helps you to find the compound interest when interest is compounded quarterly, that is, four times in a year.
How to Use the Compound Interest Calculator?
Follow the given steps to use the calculator:
- Step 1: Enter the principal, rate of interest and time period in the respective input boxes.
- Step 2: Click on "Calculate" to find the compound interest for the given information.
- Step 3: Click on "Reset" to clear the fields and enter the new values.
How to Find Compound Interest Quarterly?
Compound Interest is the interest that is earned on your original deposit and on the interest that your money earns. Now, if the rate of interest is annual but the interest is compounded quarterly, this means that the interest is calculated for 3 months or 4 times in a year. In this case, the number of years 'n' is 4 times (i.e., made 4n) and the rate of annual interest (r) becomes one-fourth, that is, r/4. Hence, we use the following formula for compound interest since the interest is calculated quarterly.
Compound Interest = P(1 + r/400)4n - P
Here P is the Principal value, r is the rate of interest, n is the number of time periods in the given time. Let us understand how to calculate compound interest with the help of the following example.
Solved Example:
Find the compound interest for a principal of $30,000 for a rate of interest of 12%, for a time of 1 year, if the interest is compounded quarterly.
Solution:
The given information can be taken as the Principal (P) = $30,000, Rate of interest= 12% per annum, time period = 1 year.
We shall apply this value in the compound interest quarterly formula.
Compound Interest = P(1 + r/400)4n - P
=30,000 (1 + 12/400)4 - 30,000
=[30,000 × (3/100)4 ]- 30,000
=(30,000 × 103/100 ×103/100 × 103/100 × 103/100) - 30,000
= 33745.92 - 30000
= 3745.92
Therefore, the compound interest is $3745.92.
Now, try the calculator to find the compound interest for the following values.
- Principal of $5000 for a time of 2 years and rate of interest of 10% and compounded quarterly.
- Principal of $5000 for a time of 2 years and rate of interest of 10% and compounded quarterly.