I P x r x t where I is the interest in dollars P. Therefore if both simple and compound interests have the same rate the interest generated will always be higher when compounding. 6000 1 9 12 6000 2813 16878.
The interest typically expressed as a.
To calculate simple interest you use a simplified version of the compound interest formula. In the compound interest formula the time element is represented exponentially. FV is the future value of the investment including interest. Compound interest 16878 6000.