Difference between revisions of "Simple Interest Formula"
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Latest revision as of 12:04, 11 June 2019
Definition
Simple Interest denotes the direct calculation of interest to the principal sum of a loan or deposit (without compounding of previous interest rate periods)
Formula
Where
 is the number of business days in the interest period
 is the number of calendar days in the interest period
 is the interest rate applicable on business day i
 is the number of calendar days for which rate ri applies (on most days, ni will be 1, but on a Friday it will generally be 3, and it will also be larger than 1 on the business day before a holiday).
 N is the market convention for quoting the number of days in the year.
See Also
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