answersLogoWhite

0

Simple interest:

Every time interest is paid, it's paid on the amount you originally put in.

Compound interest:

Every time interest is paid, it's paid on the amount you had after the last time interest was paid.

So, part of the interest that's paid today is interest on all the interest that's ever been paid, on

top of the amount you originally put in.

User Avatar

Wiki User

14y ago

Still curious? Ask our experts.

Chat with our AI personalities

DevinDevin
I've poured enough drinks to know that people don't always want advice—they just want to talk.
Chat with Devin
ProfessorProfessor
I will give you the most educated answer.
Chat with Professor
JordanJordan
Looking for a career mentor? I've seen my fair share of shake-ups.
Chat with Jordan

Add your answer:

Earn +20 pts
Q: What is the fundamental difference between simple and compound interests?
Write your answer...
Submit
Still have questions?
magnify glass
imp