Question

Explain the terms Simple Interest and Compound Interest

Answer 1

$\huge✎\fbox \orange{QUE} \colorbox{blue}{ST} \fbox\green{ION}☟$

$\small{\mathtt{\colorbox{indigo}{\pink{❤Explain the terms Simple Interest and Compound Interest.❤️}}}}$

$\Large\bold{\sf{\colorbox{pink}{\blue{꧁Ans᭄wer꧂}}}}$

$\Large\bold{\sf{\colorbox{yellow}{\blue{Explanation:↓}}}}$

$\large\bold{\sf{\colorbox{indigo}{\orange{Simple Interest:↓}}}}$

Simple interest is a quick and easy method of calculating the interest charge on a loan. Simple interest is determined by multiplying the daily interest rate by the principal by the number of days that elapse between payments. This type of interest usually applies to automobile loans or short-term loans, although some mortgages use this calculation method.

$\large\bold{\sf{\colorbox{indigo}{\orange{Compound Interest:↓}}}}$

Compound interest is the addition of interest to the principal sum of a loan or deposit, or in other words, interest on interest. It is the result of reinvesting interest, rather than paying it out, so that interest in the next period is then earned on the principal sum plus previously accumulated interest.

$\large\bold\red{\overbrace{\underbrace {\sf\blue{Please \:  Mark \:  As \:  The \:  Brainliest}}}}$

$\Large\bold{\mathtt{\colorbox{gold}{\red{If \: It \:Satisfied \:You}}}}$

$\large\bold\red{\overbrace{\underbrace {\sf\blue{And \:Please \:give \:Thanks}}}}$

꧁Hopes so that this will help you,꧂

$\Large\bold{Your}\: \bold\orange{In}\bold{di}\bold\green{an}\:\Large\bold{Brother,}$

✌︎Thank you✌︎

$\large\red{\underbrace{\overbrace\mathtt{\colorbox{aqua}{\colorbox{blue}{\colorbox{purple}{\colorbox{pink}{\colorbox{green}{\colorbox{gold}{\colorbox{silver}{\textit{\purple{\underline{\red{《❀DÎVYĀ᭄ÑSHÛ✿》࿐}}}}}}}}}}}}}}$

$\large\red{\underbrace{\overbrace\mathbb{\colorbox{aqua}{\colorbox{blue}{\colorbox{purple}{\colorbox{pink}{\colorbox{green}{\colorbox{gold}{\colorbox{silver}{\textit{\purple{\underline{\red{《❀FOLLOW✿》࿐}}}}}}}}}}}}}}$

Answer 2

ANSWER :

❒ Simple Interest :-

• ➬ The term "Simple Interest" can be defined as interest calculated on the initial amount of money borrowed for a specific period of time; that means, when the interest is calculated on the initial sum of money borrowed throughout the specified period, then the interest obtained is known as Simple Interest.

____________________________________________

❒ Compound Interest :-

• ➬ The term "Compound Interest" can be defined as the interest calculated at the end of first period and amount obtained so is added to the principle for calculating the interest for the further period; that means, when the interest that falls due at the end of a specified time period is added to the principal and the amount so obtained becomes the principal for calculating interest for the subsequent period and the process goes on, thus the interests obtained is knowns as Compound Interest.

_________________________________________________________

KNOW MORE :

❍ Interest :-

• ➪ When a person borrows a sum of money from another person or bank or any other financial institutions for a period, on the expiry of that period, the person (borrower) has to repay his debg by paying some extra money along with the original sum of money. The extra sum of money is known as Interest.

____________________________________________

❍ Types of Interest :-

• ➪ Simple Interest

• ➪ Compound Interest

____________________________________________

❍ Formluas :-

If,

• Principal = P

• Rate of Interest = r

• Period of time = n

• Amount = A

• Interest = I

• Simple Interest = S.I.

• Compound Interest = C.I.

Then,

❖ Formula for Calculating Simple Interest :

• $\: \: \: \: \: \bigstar \: \: \: \: \: \boxed{\large{ \rm{ \: \: S.I. = \dfrac{P \times r \times n}{100} \: \: }}}$

____________________________________________

❖ Formula for Calculating Compound Interest :

• $\: \: \: \: \: \bigstar \: \: \: \: \: \boxed{\large{ \rm{ \: \: C.I. = A - P \: \: }}}$

Or,

• $\: \: \: \: \: \bigstar \: \: \: \: \:\boxed{\large{ \rm{ \: \: C.I. = P \: [(1 + \frac{r}{100}) {}^{n} - 1 ] \: \: }}}$

____________________________________________

❖ Formula for Calculating Amount of C.I. :

• $\: \: \: \: \: \bigstar \: \: \: \: \:\boxed{\large{ \rm{ \: \:A = P \: (1 + \dfrac{r}{100} ) {}^{n} \: \: }}}$

____________________________________________

❖ Formula for Calculating Amount when Principal and Amount of interest is given :

• $\: \: \: \: \: \bigstar \: \: \: \: \:\boxed{\large{ \rm{ \: \:A = P + I \: \: }}}$