The concept that the interest is added to the principal at the end of each time period and considered as principal. for next time period is called as

Compound Interest

Step-by-step explanation:

⇒  The calculation of interest on the interest of principal amount is called Compoundinterest.

⇒  Compound interest is the addition of interest to the principal sum of a loan or deposit, or in other words, interest on interest. 

⇒  It is the result of reinvesting interest, rather than paying it out, so that interest in the next period is then earned on the principal sum plus previously accumulated interest.

⇒  Compound interest is standard in finance and economics.

step-by-step explanation:

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