Compare simple and compound interest
Imagine leaving a starting amount untouched. Compare adding interest only on the original amount with adding interest on the growing balance.
Your experiment
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Why it works
simple = P(1 + rt); compound = P(1 + r)ᵗ
Assumptions and limits
A mathematical model with a constant rate, annual compounding, no deposits, withdrawals, fees or tax. The rate is illustrative, not an available financial product or personal advice.