Continuously Compounded Interest
Interest that
is, hypothetically, computed and added
to the balance of an account every instant.
This is not actually possible, but continuous compounding is welldefined
nevertheless as the upper bound of "regular" compound
interest. The formula, given below, is sometimes called the shampoo
formula (Pert^{®}).
Note: This same formula can be
used for exponential growth and exponential
decay.
See also
Halflife, doubling
time
