A compound microscope uses multiple lenses to magnify objects. It has two main optical parts: an objective lens closest to the specimen that produces a real, inverted intermediate image, and an eyepiece lens that further magnifies this image for viewing. Working together, the objective and eyepiece lenses can magnify objects up to 1000 times their actual size, allowing observation of fine structural details of cells, tissues, and organs that are not visible to the naked eye.