Formula Sheet - Maths for Business
1
Simple Interest/Discount
Simple interest formula:
I = P RT
Maturity value:
M V = P + P RT
Bank Discount:
I = P RT
Proceeds:
P rocceds(A) = P − I
Effective Interest Rate:
=
2
I
AT
Compound Interest
Compound amount:
F uture value = P (1 + R)N
1
Compound interest value:
I = P (1 + R)N − P
3
Stocks and Bonds
P/E Ratio:
P/E ratio =
Current price per share
N et income per share
Current Yield for stock:
Current Y ield =
annual dividend per share
closing price per share
Current Yield for bonds:
Current Y ield =
4
interest rate ∗ 1000
P rice per bond
Stats
Mean:
P
fx
P
f
Variance:
P 2 P 2
fx
fx
P
− P
f
f
5
Mark up
Based on Cost:
M = M% ∗ C
S = S% ∗ C
S =M +C
2
S% = M % + C%
Based on Selling Price:
M = M% ∗ S
C = C% ∗ S
S =C +M
S% = M % + C%
Selling price per item to achieve desried profit:
Selling price per item to achieve desired prof it (markup) =
Equivalent mark-up based on cost:
Mcost % =
Mselling %
(100 − Mselling )%
Equivalent mark-up based on selling:
Mselling % =
Mcost %
(100 + Mcost )%
3
total selling price
expect − to − sell quantity