What is the difference between simple interest and compound interest?
Answer to relevant QuestionsHow does changing the compounding period affect the amount of interest earned on an investment?What is the difference between the interest rate (i) and the growth rate (g) in the future value equation? If you were given a choice of investing in an account that paid quarterly interest and one that paid monthly interest, which one should you choose if they both offer the same stated interest rate and why?Your bank pays 5 percent interest semiannually on your savings account. You don’t expect the current balance of $2,700 to change over the next four years. How much money can you expect to have at the end of this period?Elizabeth Sweeney wants to accumulate $12,000 by the end of 12 years. If the annual interest rate is 7 percent, how much will she have to invest today to achieve her goal?
Post your question