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What is the concepts of compound interest?
The concept is that at the end of each time interval, the interest for that period is added to the principal. As a reult, the interest for any period is calculated not only on the principal but also the interest from previous periods.
What is a simple interest in math?
Simple interest is interest that is calculated only on the amount of unpaid principal on a loan. Such interest is not added to the value of the loan but is tracked separately. Compound interest is interest that is calculated on the total of unpaid principal and accumulated interest on a loan. The difference is in simple interest there is no interest charged on accumulated interest while in compound interest there is interest charged on accumulated interest.
How is accumulated interest calculated?
Accumulated or compound interest is calculated by adding interest to both the principal and any interest accumulated up to the point of the calculation.
Which type of interest is calculated by adding the interest earned to the principal during specific and agreed upon intervals?
comopound
Interest calculated not only on the original principle but also on the interest already accumulated is called?
The answer is compound interest
