Interest Rate Calculator
Understanding Interest Rates
Interest rate is the percentage of principal charged by a lender or earned from an investment. Simple interest rate is calculated as Interest / (Principal × Time). Compound interest rate accounts for interest earned on previously accumulated interest.
Key Formulas
- Simple: Rate = Interest / (P × T)
- Compound: Rate = ((A/P)^(1/t) - 1) × 100
💡 Tips
- Interest rates vary by loan type and creditworthiness
- APR includes fees and is higher than the base rate
- Central bank rates influence personal loan rates
- Compound interest grows faster over time