Compound interest adds accumulated interest back to principal. Formula: A = P(1+r/n)^nt, where A is future value, P is principal. Effective annual rate (APY) shows actual interest after compounding
Interest rate is the percentage charged by lender for using borrowed money. Used for calculating loan repayments and investment interest. Also applies to credit card interest calculations
Interest is the cost of borrowing money from a lender. Interest can be earned through direct or indirect lending. Monthly payments first cover interest, then principal repayment
Daily compound interest calculates interest on principal and previously accrued interest. More frequent compounding leads to higher interest earnings. Continuous compounding yields highest interest, followed by daily, monthly, quarterly, semiannually, and annually
Compound interest earns interest on both principal and accumulated interest. Accounts with compound interest grow faster than simple interest. Interest rates are typically annual, monthly, or daily
Principal is the original loan amount without interest. Interest represents the cost of borrowing charged by the lender. Simple interest loans have fixed monthly payments