The process is repeated until the amount for the last. The interest calculated every year on original principal i e.

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### Money is said to be lent at compound interest when at the end of a year or other fixed period the interest that has become due is not paid to the lender but is added to the sum lent and the amount thus obtained becomes the principal in the next year or period.

**Simple and compound interest notes**. The sum at the beginning of the first year. Important formula and equations principal. While the total interest payable over the three year period of this loan is 1 576 25 unlike simple interest the interest amount is not the same for all three years because compound interest.

Si pnr a p si. Sum of principal and interest and is denoted by a. The interest is added to the principal at the end of each period to arrive at the new principal for the next.

Simple and compound interest simple and compound interest key notes updated on oct 2020 68622. The money borrowed or lent out for a certain period is called the. It is denoted by si.

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