WHAT IS DIFFERENCE BETWEEN COMPOUND INTEREST &COMPOUNDED ANNUALLY ?????????????
Dear student,
Compound interest is interest calculated on the initial principal which also includes all of the accumulated interest from previous amount or loan.
Compounded annually means a method of calculating and adding interest to an investment or loan once eara year.
So the basic difference between compound interest and compound annually is in compound interest, interest is calculated on initial amount as well as previous amount and the interest is applied after a specific time but in case of compounded annually the interest is applied only once a year.
I hope this will help you to understand.
Regards.
Compound interest is interest calculated on the initial principal which also includes all of the accumulated interest from previous amount or loan.
Compounded annually means a method of calculating and adding interest to an investment or loan once eara year.
So the basic difference between compound interest and compound annually is in compound interest, interest is calculated on initial amount as well as previous amount and the interest is applied after a specific time but in case of compounded annually the interest is applied only once a year.
I hope this will help you to understand.
Regards.