Financial modelling terms explained

# Period

Period refers to the period of time at which a particular financial transaction or event occurs. In accounting, the period of time is usually a month, quarter, or year.

## What Is a Period?

A period is a unit of time that is used to measure the length of time between two events. It is also used to calculate the frequency of a periodic event. A period can be defined as the time it takes for one complete cycle of a waveform to occur. It can also be defined as the time it takes for a planet to make one complete orbit around the sun.

## How Do You Calculate a Period?

In order to calculate a period, you need to know the following information:

-The number of days in the period

-The number of days in the year

-The interest rate

Once you have this information, you can calculate the period by using the following equation:

period = (days in year - days in period) / interest rate

## What Do You Have to Watch Out for When You're Calculating a Period?

When calculating a period, you have to watch out for two things: compounding and rounding. Compounding can cause your calculations to be inaccurate, especially over long periods of time. Rounding can also cause inaccuracies, especially if you are calculating a period that is not evenly divisible by the number of days in the month. To avoid these inaccuracies, you should use a calculator that is accurate to the nearest hundredth of a percent.

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