MAT 109 Lecture Notes - Lecture 19: Economic Model, Precalculus, Interest
Document Summary
Provide a generalization to each of the key terms listed in this section. P : p rincipal r : (p er annum) interest rate t : y ears. 2. 7 not taught: daily in a leap year. 3 compounded interest: daily: 365 times per year. 2: banks de ne interest with the following information: 1st cycle : a1 = p (1 + rt) 2nd cycle : a2 = a1 (1 + rt) = p (1 + rt) (1 + rt) = p (1 + rt)2. 3rd cycle : a3 = a2 (1 + rt) = p (1 + rt)2 (1 + rt) = p (1 + rt)3. Any cycle : ak = p (1 + rt)k. 3 r : (p er annum) interest rate n : n umber of t imes per y ear t : y ears. 6. 6 daily compounding n = 52 n = 365. 6. 7 not taught: daily in a leap year n = 366.
