answer:As I understand it, simple interest just ignores compounding. Like this: FV = principle × interest × periods. I would have thought compound interest is the conventional way to do a bank loan, using an ordinary annuity: FV = C ([(1+r)^n-1]/r) Where FV = future value, C = payment per period, r = interest rate, n = number of periods Is the fee being discounted? What context is this for?