The charging of interest or discounting of future receipts on a continuous basis. At a rate of 100r per cent, added annually, a loan will have grown to (1 + r)^T times its original value after T years. If interest is added v times a year, it will grow to (1 + r/v)^Tv, which is greater the larger is v. As v tends to infinity, (1 + r/v)^Tv tends to the limit e^rT, where e is the exponential constant. Similarly, if a future receipt due in T years is discounted to find its present value at a continuous rate r, its present value with continuous discounting is e^-rT times what is due at the end of the T years.