### Solved Example Problems

The below solved example problems for compound interest may used to understand how the values of Principal amount P, Rate of interest R, Time period n & componding frequency are being used in the monthly, quarterly, half-yearly or yearly compounding formulas to find the total interest payable.__Example Problem 1:__

How much amount of compound interest payable on a principal sum of 10,000 USD at 9% rate of interest for the total period of 3 years with yearly compounding frequency or period?__Solution:__

P = 10,000 USD on yearly compounding frequency

R = 9%

n = 3 Years

apply these above values in the below annual compound interest formula

CI_{yearly} = P [1 + (R/100)^{n}]

= 10000 x [1 + (9/100)^{3}]

= 2950.29

The total interest payable is 2950.29 USD__Example Problem 2:__

How much amount of total interest payable on a principal sum of 20,000 USD at 7% rate of interest for the total period of 4 years with half-yearly compounding frequency or period?__Solution:__

P = 20,000 USD on half-yearly compounding frequency

R = 7%

n = 4 Years

apply these above values in the below semi-annual compound interest formula

CI_{half-yearly} = P (1 + [(R/2)/100]^{2n})

= 20000 x (1 + [(7/2)/100]^{(2 x 4)}

= 6336.18

The total interest payable is 6336.18 USD__Example Problem 3:__

How much amount of total interest payable on a principal sum of 15,000 USD at 6% rate of interest for the total period of 5 years with quarterly compounding frequency or period?__Solution:__

P = 15,000 USD on quarterly compounding frequency

R = 6%

n = 5 Years

apply these above values in the below quarterly compound interest formula

CI_{quarterly} = P (1 + [(R/4)/100]^{4n})

= 15000 x (1 + [(6/4)/100]^{(4 x 5)}

= 5202.83

The total interest payable is 5202.83 USD__Example Problem 4:__

How much amount of total interest payable on a principal sum of 25,000 USD at 5% rate of interest for the total period of 3 years with monthly compounding frequency or period?__Solution:__

P = 15,000 USD on monthly compounding frequency

R = 5%

n = 3 Years

apply these above values in the below monthly compound interest formula

CI_{monthly} = P (1 + [(R/12)/100]^{12n})

= 25000 x (1 + [(5/12)/100]^{(12 x 3)}

= 4036.81

The total interest payable is 4036.81 USD

Compound interest is a very important interest calculation to determine the time value of money in many financial instruments.

## Compound Interest Spreadsheet

The above formula & solved examples may used to understand how to calculate compound interest for the different compounding frequencies, however, when it comes to online for quick calculations, this compound interest calculator may used to find the total interest payable & total amount payable in different currencies in the World.