Business / Taxes / Compound Interest: When the interest you earn on an investment is added to form the new base on which future interest accumulates, it is compound interest. For example, say you earn 5% compound interest on $100 every year for five years. You'll have $105 after one year, $110.25 after two years, $115.76 after three years, and $127.63 after five years. Without compounding, you earn simple interest, and your investment doesn't grow as quickly. For example, if you earned 5% simple interest on $100 for five years, you would have $125. A larger base or a higher rate provide even more pronounced differences. Compound interest earnings are reported as annual percentage yield (APY), though the compounding can occur annually, monthly, or daily.
Compound Adjective Synonyms: composite, blend, synthesis, combination, consolidation, parasynthesis, parathesis, mixture, amalgam, alloy, merging, merger, mix
Compound Noun Synonyms: put together, combine, mix, concoct, compose, make (up), formulate, blend
Compound Verb Synonyms: blend, merge, coalesce, combine, unite, fuse or also fuze, come or go together
Interest Adjective Synonyms: concern, significance, importance, weight, moment, note, consequence
Interest Noun Synonyms: attention, attentiveness, concern, regard, curiosity, scrutiny, notice, engagement
Business / Finance / Interest Payments: Interest earned on reinvestment of each interest payment on money invested. See: compound interest. MORE
Business / Taxes / Periodic Interest Rate: The periodic interest rate, sometimes called the nominal rate, is the interest rate a lender charges on the amount you borrow. Lenders are also required to tell you what a loan will actually cost per MORE