Which of the following is correct about compounding interest?

A. It allows you to earn interest on your total account balance, not just your contributions, which can significantly increase your savings over time.
B. It's really simple to compute; it's just the total of your contributions multiplied by the interest rate each period.
C. Compounding interest can't make as much money as simple interest.

Question

0BananaNinja16 0BananaNinja16

30-07-2024
Mathematics

Answered

Which of the following is correct about compounding interest?

A. It allows you to earn interest on your total account balance, not just your contributions, which can significantly increase your savings over time.
B. It's really simple to compute; it's just the total of your contributions multiplied by the interest rate each period.
C. Compounding interest can't make as much money as simple interest.

Answer :

Other Questions

what does bulto mean in spanish

Scientist never say a theory is proven or not they only say if the evidence _____or _____ it

which fraction is bigger 2/15 or 3/20?

what is the relationship between the 6s in the number 6647?

A stone falls from the top of a 125m high cliff.How long does it take to reach the sea?I know that S[distance] is 125m, and that A[acceleration] is 10m/s². Cons

Acid and an alkali combined together will give a salt,if they are mixed in the right amount1)What is the name given to this reaction

Write an equation to represent each relationship. Then solve the equation.34. Three times the sum of a number and 4 is the same as 18 more than the number.36.

A stone falls from the top of a 125m high cliff.How long does it take to reach the sea?I know that S[distance] is 125m, and that A[acceleration] is 10m/s². Cons

At the zoo there were 3 times as many monkeys as lions. Tom counted a total of 24 monkeys and lions. How many monkeys were there ?

GinnyAnswer GinnyAnswer · Answer 1 · 2024-07-30T12:09:29-04:00

Final answer:

Compound interest allows earnings on total account balance, not just contributions, significantly increasing savings over time. Comparatively, simple interest is calculated only on the principal amount.

Explanation:

Compound interest is calculated on the principal plus the accumulated interest, allowing you to earn interest on your total account balance, not just your contributions. It can significantly boost your savings over time by accumulating interest on interest.

Simple interest, on the other hand, is calculated only on the principal amount. While simple interest is easy to compute, compound interest has the potential to earn more money over time by leveraging the power of compounding.

Learn more about Compound interest vs. Simple interest here:

https://brainly.com/question/37152955