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Compound interest
(redirected from Continuous compounding)

    Also found in: Financial, Wikipedia, Hutchinson 0.54 sec.

Interest generated by the sum of the principal and any accrued interest.

Interest is normally compounded on a daily, quarterly, or yearly basis. The more often interest is compounded, the larger the principal will grow and the greater the interest the new principal will produce.

compound interest n. payment of interest upon principal and previously accumulated interest which increases the amount paid for money use above just simple interest. Thus, it can increase more rapidly if compounded daily, monthly or quarterly. The genius physicist Albert Einstein called compound interest man's "greatest invention." Most lenders agree. (See: interest, promissory note)

COMPOUND INTEREST. Interest allowed upon interest; for example, when a sum of money due for interest, is added to the principal, and then bears interest. This is not, in general, allowed. See Interest for money.



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? References in periodicals archive
Turnkey, custom-engineered batch or continuous compounding lines can be provided complete with upstream and downstream support equipment and customized automation.
Compounding and mixing systems by Plastics Technology
Results from this research demonstrate that continuous compounding of rubber for technical goods is a suitable and promising alternative to today's batch mixing process.
Continuous mixing of EPDM rubber with a co-rotating twin screw ... by Lavaggi, Pietro / Rubber World
The total rate of return--price changes plus dividends--on the stock in question, measured on the basis of continuous compounding over the option's life, is a random variable drawn from a normal bell curve distribution.
FASB 123: putting together the pieces by Mountain, James R. / Journal of Accountancy
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