SI and CI comparison: SI = (P × R × T)/100 (linear growth); CI = P(1 + r/100)^n (exponential growth). For same P and r: CI always ≥ SI. Difference increases with time. CI - SI formula for n=2: (P × r²)/(100²). Example: P=100, r=10%, T=2. SI=20, CI=21, difference=1. For T=3: SI=30, CI=33.1, difference=3.1. Graph: SI is straight line; CI is curve above it. When to use: Savings/loans use CI; simple contracts use SI. Shortcut: For short terms (T<1), SI ≈ CI. Exam tip: Always specify which interest type is asked. Practice: Compare investments using both methods.