Compound Interest gives you interest based on the amount deposited and the other interests earned.Simple Interest gives the same amount each time based on only the amount deposited.The compound interest has more since it is given more money to put interest on.For example, someone has 20,000 in a bank account and has 6% of interest each year in compounded interest.The fist year he will earn 1,200 the next he will earn 1,272 and then the following he will earn 1,348.32. While in an account that has simple interest will earn 1,200 each year which adds up to less that the one with compounded interest.
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