Interest often compounds more frequently than once a year. The compounding formula can easily be adjusted to allow for semiannual, quarterly, or any other regular frequency-of-interest payment. For example, suppose interest is paid twice a year. With an annual rate of 10 percent, that system would mean 5 percent interest is paid for the first half of the year and 5 percent is paid for the second half of the year. Thus principal plus interest amounts at the end of the half-years would be