Paper I · 16 Logical Reasoning, Analytical Ability & Data Interpretation · 16.3 Percentages and commercial arithmetic

16.3.5 Compound interest and the CI–SI difference

Under compound interest each year's interest is added to the principal, so the amount grows by a fixed multiplier, and the gap over simple interest is "interest on interest".

  • TGPSC MPSO / ASO · Paper I
  • Standard level
  • 5 min read
  • Full course

Key terms

  • compound interest
  • amount
  • CI-SI difference
  • consecutive amounts
  • interest of one year
  • doubling time
  • dividing a sum
  • interest on interest

What this note covers

  1. Core factsFoundation
  2. ExplainedStandard
  3. DeeperAdvanced
  4. Common trapsFoundation
  5. Quick revisionFoundation

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