The annualized interest rate of the loan shall be calculated according to the ratio of all loan fees charged to the borrower to the actually occupied loan principal, and converted into annualized form.
The annualized interest rate of the loan can be calculated by compound interest or simple interest, among which, if simple interest is used, it should be explained that it is simple interest. Simple interest means that no matter how long the deposit period of the fund is, only the principal interest is charged, and the interest of previous periods is not charged in the next interest-bearing period.
Simple interest means that no matter how long the deposit period of the fund is, only the principal interest is charged, and the interest of previous periods is not charged in the next interest-bearing period.
First, the symbol of simple interest.
In simple interest calculation, the following symbols are often used:
P- principal, also known as initial amount or present value;
I- interest rate, usually refers to the ratio of annual interest to principal;
I- interest;
F- the sum of principal and interest, also known as the sum or final value of principal and interest;
N—— Number of interest-bearing periods, usually in years.
Second, the calculation formula of simple interest
Interest (I)= principal (P)× interest rate (I)× number of interest-bearing periods (n)
When calculating interest, unless otherwise specified, the interest rate given refers to the annual interest rate. For interest less than one year, one year is equal to 360 days.
According to people's use requirements, the calculation of simple interest can be divided into final value and present value.
Calculation of the final value of simple interest
The ultimate value of simple interest is the sum of the principal and interest of a certain fund at a certain point in the future. The formula for calculating the final value of simple interest is: F = P+P×I×n = P×( 1+I×n).
Calculation of present value of simple interest
In actual economic life, it is sometimes necessary to determine its present value according to the final value, that is, the present value. The formula for calculating the present value of simple interest is: P = F-I = F-P×I×n = F/( 1+I×n).
Third, the annual interest rate and annualized interest rate
Both annual interest rate and annualized income are used to calculate the income generated by wealth management products within one year.
The interest rate and discount rate of annualized income are different. The annual interest rate is calculated on an annual basis. The annualized interest rate may be 1 day, 1 week to 365 days, which can be converted into one-year interest.
Annual interest rate refers to the ratio of interest amount to deposit principal or loan principal within one year, which is a fixed value and determines the income and interest of deposits and loans.
The annualized interest rate is the annualized rate of return converted from the current rate of return. This interest rate is only a theoretical interest rate, not real income data. The annualized interest rate will change in a short time, which can reflect the performance level of a product in a period of time.