---
id: 6363d26c9078df117ce4c405
title: "Simple and Compound Interest"
challengeType: 15
videoId: iMPFK7wXNPg
dashedName: simple-and-compound-interest
---

# --description--

This video will help you understand the equations of simple and compound interest, and what it all means.

Here is the <a href="https://colab.research.google.com/drive/1IVBaeX84arJXS73raRROaxbz4qMyFVb6?usp=sharing" target="_blank" rel="noopener noreferrer nofollow">Colab notebook to go along with this video.</a>

Here is an additional <a href="https://colab.research.google.com/drive/1-HWYmzKn6HmEUWMBv7G525CpoQpm8TnN?usp=sharing" target="_blank" rel="noopener noreferrer nofollow">Colab notebook that shows you one way to put many of these interest and payment forumlas into Python functions.</a> Also you will see an example of using some formulas to output results, notice a trend, and follow up with other formulas to analyze patterns.

# --question--

## --text--

In percent increase formulas, what does the "principle" refer to?

## --answers--

the main amount

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the ending amount

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the starting amount

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the (1 + rate) multiplier

## --video-solution--

3
