Percentage: Parts per 100 of a whole
Similar across both types of interest
Principal amount (eg. $10000)
Rate (eg. 5% p.a.)
Duration/time (eg. 4 years)
Rate and duration must have the 'same time frame', like pa (per annum) and 4 months is not acceptable.
Money must always be expressed in 2dp!
Interest = (Principal x rate x duration) / 100
In the event if the duration is in 'months' and rate is in 'year'
divide the duration by 12 (since 1 year has 12 months, obviously)
In the event the rate is in 'months' and duration is in 'year'
Multiply the rate by 12.
Year(final year) = principal amount x (1 + rate in decimals)^(final year)
Same rules apply for 'same time frame'.
Principal amount/capital + interest paid off in installments
Disclaimer: If I got something wrong please comment or something and this is the first ever post so I don't know what Mr Ingham is going to think about it :(