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compounding of interest refers to the action wherein, the interest paid to us over a period of time would increase gradually.

Ex: Lets say you invest Rs. 10000/- at 10% per annum which is compounded every quarter.

So interest for first quarter: Rs. 250/-

Principal at the end of first quarter: 10,250/-

Interest for second quarter: Rs. 256.25/-

Principal at the end of second quarter: 10,506.25/-

the increase in interest in the second quarter is because, the interest paid during the first quarter is also considered for interest payment in the second quarter. So, even though the principal amount we invested remains the same the interest varies because of compounding of interest.

The shorter the compounding period, greater is the interest earned.

Simple interest is to charge interest on the principle amount.

compound interest is the interest calculated on the simple interest!

Q: What does compound interest mean?

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its compound interest

yes

The conclusion was when the interest was paid out.

Simple interest: stays the same. Compound interest: increases.

compound

Related questions

It depends on which compound interest formula you mean. Refer to the Wikipedia Article on "Compound Interest" for the correct terminology.

With compound interest, the interest due for any period attracts interest for all subsequent periods. As a result, compound interest, for the same rate, is greater.With compound interest, the interest due for any period attracts interest for all subsequent periods. As a result, compound interest, for the same rate, is greater.With compound interest, the interest due for any period attracts interest for all subsequent periods. As a result, compound interest, for the same rate, is greater.With compound interest, the interest due for any period attracts interest for all subsequent periods. As a result, compound interest, for the same rate, is greater.

compound... yes it is compound interest.

There is simple interest and there is compound interest but this question is the first that I have heard of a simple compound interest.

its compound interest

compound interest increases interest more than simple interest

Compound interest.

There is no carrot in the compound interest formula!

Compound interest

Compound Interest

Continuous compounding is the process of calculating interest and adding it to existing principal and interest at infinitely short time intervals. When interest is added to the principal, compound interest arise.

The interest for 1 year is 37.00, whether it is simple or compound interest.