Annual compounding
Annual compounding is the arithmetic process of determining the final value of a cash flow or series of cash flows when interest is added once a year.
Definitions
According to Fundamentals of Financial Management by Eugene F. Brigham and Joel F. Houston (15th edition),
- Annual compounding. The arithmetic process of determining the final value of a cash flow or series of cash flows when interest is added once a year.
Related concepts
- Financial management. A combination of enterprise efforts undertaken in order to procure and utilize monetary resources of the enterprise.
