Question

what is the difference between compound interest and simple interest?



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Answer 1

Answer:

The interest, typically expressed as a percentage, can be either simple or compounded. Simple interest is based on the principal amount of a loan or deposit. In contrast, compound interest is based on the principal amount and the interest that accumulates on it in every period. Simple interest is calculated only on the principal amount of a loan or deposit, so it is easier to determine than compound interest.

Step-by-step explanation:

Simple Interest formula : Principal × Rate × Time

compund interest formula : Principal × (1 + Rate)time - Principal.

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Answer 2

Step-by-step explanation:

this is the correct answer