C++ Program to Calculate Compound Interest

C++ 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 C++ 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. C++ Program & output to calculate compound interest using formula

Code has been copied

/***************************************************************
            		alphabetacoder.com
	C++ program to calculate compound interest using formula
****************************************************************/

#include <iostream>
#include <cmath>

using namespace std;

int main(){
    // declare variables
    float ci, amount, p, r, t;
    int n;
    
    // take input of initial principal amount,
    // interest rate, periodicity of payment and year
    cout<<"Enter the principal balance = ";
    cin>> p;
    cout<<"Enter the annual interest rate = ";
    cin>> r;
    cout<<"Enter compound frequency / year = ";
    cin>> n;
    cout<<"Enter the year  = ";
    cin>> t;
    
    // calculate compounded value
    // using formula
    amount = p * pow((1 + r/(100 * n)), n*t);
    
    //find the compound interest
    ci = amount - p;
    
    // display result
    cout<<"Compound interest = "<<ci<<endl;
    
    return 0;
}

Output

Enter the principal balance = 17000

Enter the annual interest rate = 10

Enter compound frequency / year = 1

Enter the year = 2

Compound interest = 3570

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

Code has been copied

/***************************************************************
            		alphabetacoder.com
C++ program to calculate compound interest using loop (Iteration)
****************************************************************/

#include <iostream>

using namespace std;

int main(){
    // declare variables
    float ci, amount, p, r, t;
    int n, i;
    
    // take input of initial principal amount,
    // interest rate, compound frequency and year
    cout<<"Enter the principal balance = ";
    cin>> p;
    cout<<"Enter the annual interest rate = ";
    cin>> r;
    cout<<"Enter compound frequency / year = ";
    cin>> n;
    cout<<"Enter the year  = ";
    cin>> t;
    
    // initialize
    amount = p;
    
    // calculate compounded value using loop
    for(i = 0; i < n * t; i++)
    	amount = amount + amount * (r / (n * 100));
    
    //find the compound interest
    ci = amount - p;
    
    // display result
    cout<<"Compound interest = "<<ci<<endl;
      
    return 0;
}

Output

Enter the principal balance = 5000

Enter the annual interest rate = 7.5

Enter compound frequency / year = 4

Enter the year = 6

Compound interest = 2808.96

3. C++ Program & output to calculate compound interest using recursion

Code has been copied

/***************************************************************
            		alphabetacoder.com
C++ program to calculate compound interest using recursion
****************************************************************/

#include <iostream>

using namespace std;

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

int main(){
    // declare variables
    float ci, p, r;
    int n, t;
    
    // take input of initial principal amount,
    // interest rate, compound frequency and year
    cout<<"Enter the principal balance = ";
    cin>> p;
    cout<<"Enter the annual interest rate = ";
    cin>> r;
    cout<<"Enter compound frequency / year = ";
    cin>> n;
    cout<<"Enter the year  = ";
    cin>> t;
   
   // call function to compute compound interest
    ci = compound_interest(p, p, r, n, t, 0);
   
    // display result
    cout<<"Compound interest = "<<ci<<endl;
      
    return 0;
}

Output

Enter the principal balance = 2700

Enter the annual interest rate = 5

Enter compound frequency / year = 4

Enter the year = 10

Compound interest = 1737.77