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Solution: Calculate Compound Interest

Explore how to calculate compound interest through recursion in Ruby. Understand the step-by-step process of updating the principal amount each year and applying recursive calls to solve for subsequent years effectively.

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Solution

Ruby 3.1.2
# method definition with parameters
def compound_interest(principal_amount, rate, years)
  # base case
  if years == 0     
    return principal_amount
  else
    # calculation of compound interest using recursion
    principal_amount = principal_amount + rate * principal_amount
    compound_interest(principal_amount, rate, years - 1)
  end
end

Explanation

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