Compound Interest and the rule of 72

Well today in class we learned about compound interest. Although it is some what confusing to me,basically it is the amount of money you make over the years depending on the amount of interest a company makes. Over the years your deposit increases with the interest itself. Like for example, if you initially deposit $100 and the interest rate of the company is 10%, in a year then your money will increase to $100(1+ .02) (1+ .02) (1+ .02) (1+ .02) (1+ .02)= $108.24 in the next year. So each year your money will increase with the annual percentage rate.