Control Structures (Compound Interest)

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Compound interest can be calculated using the formula $$A = P\times(1 + \frac{r}{n})^{nt}$$ Where

  • P : Principal amount (P)
  • r : Annual interest rate
  • t : Time factor (t)
  • n : Number of compound periods per year.

    Following program prompts user to enter principal amount and time of loan in years. Its uses interest rate as $2.5%$ APR at compounding rate of n = 4 (quarterly compounded) and prints the final amount payable at the end of loan term.

In [3]:
def main():
    
    # Fixed parameters
    r = 0.025
    n = 4
    
    #User supplied parameters
    P = input('Enter principal amount: ')
    t = input('Enter duration of loan in years: ')
    
    if not (P.isnumeric() and t.isnumeric()):
        print ('Please enter numeric values only')
    elif (float(t)<=1 or float(P)<=0):
        print ('The principal amount P must be more than 0')
        print ('The time duration must be more than 1')
    else:
        P = float(P)
        t = float(t)
        A = P * pow((1 + r/n),(n*t))
        print ('The total amount payable is: ',A)
    
    
    
if __name__ == '__main__':
    main()
Enter principal amount: 100
Enter duration of loan in years: 2
The total amount payable is:  105.11075292222539
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