Dear reader, today we will read in Java program to calculate compound interest.
Compound Interest Formula
Compound interest is calculated using the following formula:
P (1 + R/n) (nt) - P
Here P is principal amount.
R is the annual interest rate.
t is the time the money is invested or borrowed for.
n is the number of times that interest is compounded per unit t, for example if interest is compounded monthly and t is in years then the value of n would be 12. If interest is compounded quarterly and t is in years then the value of n would be 4.
Before create Java program we calculate the compound interest.
Java Program to calculate Compound Interest
public class JavaExample { public void calculate(int p, int t, double r, int n) { double amount = p * Math.pow(1 + (r / n), n * t); double cinterest = amount - p; System.out.println("Compound Interest after " + t + " years: "+cinterest); System.out.println("Amount after " + t + " years: "+amount); } public static void main(String args[]) { JavaExample obj = new JavaExample(); obj.calculate(2000, 5, .08, 12); } }
Output:
Compound Interest after 5 years: 979.6914166032102 Amount after 5 years: 2979.69141660321