In our day-to-day life, we observe that there are certain values as population of a city, property, height of a tree, etc., which increase in magnitude over a period of time. The relative increase in the value is called growth and the growth per unit of time is called the rate of growth. Thus there is an appreciation in the value of the article. Similarly certain values as the value of a car or a machinery etc., decrease in magnitude over a period of time. Such articles are said to depreciate in value. We use the compound interest formula to calculate the appreciation and depreciation in values.