Interest can be calculated in two ways: simple interest or compound interest. Simple interest is calculated on the principal, or original, amount of a loan. Compound interest is calculated on the ...

Note that the example above is exactly the same as the example for simple interest, but the answers are different as compound interest changes the amount each period.

Note that the example above is exactly the same as the example for simple interest, but the answers are different as compound interest changes the amount each period.