Economics GCSE
Compound interest
What Compound interest means in Economics GCSE, as defined for AQA.
Definition of Compound interest
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Read the wording for your board, then hide it and explain Compound interest in your own words. Rough notes are fine. This is a self-check, with no mark or grade.
Reference: AQA
Interest calculated on the principal plus any previously accumulated interest, so each year's interest is calculated on the new total balance.
Topics that use Compound interest
Related terms
- Business investment
- Cost of borrowing
- Financial institutions
- Financial risk
- Interest rates
- Opportunity cost
- Reward for saving
- Saving
Using Compound interest in the exam
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