Python Program to Calculate Compound Interest

Python programs to calculate compound interest have been shown here. Both of the iterative and recursive approaches have been covered. Computing compound interest using formula has also been shown here.

The following section covers the Python programs to calculate compound interest.

Page content(s):

1. Program: Using formula

2. Program: Iterative approach

3. Program: Recursive approach

Additional content(s):

1. Algorithm

2. Pseudocode

3. Time Complexity

4. Flowchart

1. Python Program & output to calculate compound interest using formula

Code has been copied

##################################################################
#            	    alphabetacoder.com
#   Python program to calculate compound interest using formula
##################################################################

# take input of initial principal amount,
# interest rate, periodicity of compounding and year
p = float(input("Enter the principal balance = "))
r = float(input("Enter the interest rate = "))
n = int(input("Enter compound frequency / year = "))
t = int(input("Enter the year  = "))

# calculate compounded value
amount = p * (1 + r/(100 * n))**(n*t)
    
# find the compound interest
ci = amount - p;
    
# display result upto 2 decimal places
print("Compound interest = ",round(ci, 2))

Output

Enter the principal balance = 15000

Enter the interest rate = 7

Enter compound frequency / year = 4

Enter the year = 8

Compound interest = 11133.2

2. Python Program & output to calculate compound interest using loop (Iteration)

Code has been copied

#######################################################################
#            	        alphabetacoder.com
#   Python program to calculate compound interest using loop (Iteration)
#######################################################################

# take input of initial principal amount,
# interest rate, periodicity of compounding and year
p = float(input("Enter the principal balance = "))
r = float(input("Enter the interest rate = "))
n = int(input("Enter compound frequency / year = "))
t = int(input("Enter the year  = "))

# initialize
amount = p;
    
# calculate compounded value using loop
for i in range(n*t):
    amount = amount + amount * (r / (n * 100))
    
# find the compound interest
ci = amount - p
    
# display result upto 2 decimal places
print("Compound interest = ",round(ci, 2))

Output

Enter the principal balance = 110000

Enter the interest rate = 11.25

Enter compound frequency / year = 1

Enter the year = 8

Compound interest = 148102.88

3. Python Program & output to calculate compound interest using recursion

Code has been copied

##################################################################
#            	        alphabetacoder.com
#   Python program to calculate compound interest using Recursion
##################################################################

# recursive function to compute compound interest
def compound_interest(p0, p, r, n, t, itr):
    # if number of total no of compound reached
    if itr == n * t:
        return (p - p0)
    # calculate interest
    interest = p * (r / (n * 100))
	
    # call function
    return compound_interest(p0, p + interest, r, n, t, itr + 1)

def main():
    # take input of initial principal amount,
    # interest rate, periodicity of compounding and year
    p = float(input("Enter the principal balance = "))
    r = float(input("Enter the interest rate = "))
    n = int(input("Enter compound frequency / year = "))
    t = int(input("Enter the year  = "))
        
    # find the compound interest
    ci = compound_interest(p, p, r, n, t, 0)
        
    # display result upto 2 decimal places
    print("Compound interest = ",round(ci, 2))


# driver code
main()

Output

Enter the principal balance = 90000

Enter the interest rate = 7

Enter compound frequency / year = 4

Enter the year = 20

Compound interest = 270575.27