The answer is C. Compound interest.
Compound interest is a form of interest on which the interest is added to the principal sum of a loan or deposit, so that from that moment on, the interest that accrues also earns interest. It is the most common way of calculating interest on loans and savings accounts.
Simple interest is a form of interest calculated on the principal sum only. It is calculated by multiplying the principal sum by the interest rate and the number of years.
The effective rate of interest is the actual rate of interest paid or earned on a loan or investment. It takes into account the effects of compounding, which can make the effective rate of interest higher than the nominal rate of interest.
The nominal rate of interest is the stated rate of interest on a loan or investment. It does not take into account the effects of compounding.