banking (b) define interest and maturity value with 1 examples
Answers
The formula for calculation of maturity value is as per below:
MV = P * ( 1 + r )n

Where,
MV is the Maturity Value
P is the principal amount
r is the rate of interest applicable
n is the number of compounding intervals since the time of the date of deposit till maturity
Explanation
The formula that is used for calculation of Maturity value involves use of principal amount that is the amount which is invested at the initial period and n is the number of periods for which the investor is investing in and r is the rate of interest that is earned on that investment.
When one takes the frequency of compounding as a power to rate it get multiples which is nothing but compounding and then when that result is multiplied by principal amount, one gets the maturity value that one can have.