document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=541121>Question 541121</A>: <I><SPAN STYLE=\"word-break: break-all;\"> I found simple interest, I also need to find interest compounded annually and find the amount by which the compound interest is larger. $10,240 at 10% 11 years.  Also $7908.42 at 5% for 8 years.  Also need the effective rate correspondig to the following nominal rates, then round to the nearest hundredth of a percent for 12% compounded monthly and 9% monthly.  Thank you, I am basically looking for the solutions on how to do these types of problems. </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #354270 by </B><A HREF=/tutors/aboutme.mpl?userid=jpg7n16><B>jpg7n16(66)</B></A><img src=\"/images/stars/stars-08.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=jpg7n16><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/images/nopicture.jpg><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=354270\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> Sure. You're looking for the compounding formula:<BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=p%2A%28%281%2Bi%29%5En%29=x ALIGN=MIDDLE  ALT=\"p%2A%28%281%2Bi%29%5En%29=x\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "\"P\" is the principal amount<BR>\n" );
document.write( "\"i\" is the interest rate in each compounding period<BR>\n" );
document.write( "\"n\" is the number of compounding periods<BR>\n" );
document.write( "and you're solving for \"x\" - the new amount of money.<BR>\n" );
document.write( "To figure out the interest rate per compounding period, take the simple rate and divide by the number of periods. However for your first few problems, the period is a year, so there's no need to adjust. Simply plug your numbers into the formula.<BR>\n" );
document.write( ".<BR>\n" );
document.write( ".<BR>\n" );
document.write( "To find the effective rate, simply solve the equation using a principal amount of $1 over 1 year. For example, I'll work the 12% problem to show you how it's done:<BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=p%2A%28%281%2Bi%29%5En%29=x ALIGN=MIDDLE  ALT=\"p%2A%28%281%2Bi%29%5En%29=x\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "Using:<BR>\n" );
document.write( "P=1<BR>\n" );
document.write( "i=12% / 12=1%=.01<BR>\n" );
document.write( "n=1year*12months=12 periods<BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=p%2A%28%281%2Bi%29%5En%29=x ALIGN=MIDDLE  ALT=\"p%2A%28%281%2Bi%29%5En%29=x\"   DISABLED_style= \"max-width:90%; height:auto;\" > becomes<BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=1%2A%28%281%2B.01%29%5E12%29=x ALIGN=MIDDLE  ALT=\"1%2A%28%281%2B.01%29%5E12%29=x\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=%28%281.01%29%5E12%29=x ALIGN=MIDDLE  ALT=\"%28%281.01%29%5E12%29=x\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=x=%28%281.01%29%5E12%29=1.1268 ALIGN=MIDDLE  ALT=\"x=%28%281.01%29%5E12%29=1.1268\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "Meaning an increase of 12.68% </SPAN>\n" );
document.write( "</TD></TR></TABLE>\n" );