what is compound interest
Answers
Answer:
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 interes
Answer:
Money is said to be lent at compound interest , when at the end of a year( or, some other fixed period) the interest is not paid to the money lender, but is added to the sum lent, and the amount thus obtained becomes the principal for the next period. This process is repeated until the amount for the last period has been found. The difference between the original sum and the final sum is the compound interest.
i.e. Compound Interest = Final Amount - Original Principal = Amount - Principal= C.I = A - P
Explanation: