I’m thinking about bonds when responding to this question. The more frequent the compounding the better it will be for the lender. The less regular the compounding the better it shall be for the customer. What I showed here’s that if you are the one receiving the eye you would prefer daily compounding.
When you’re paying out interest you’ll choose simple interest. What is the monthly interest of and annual ten-percent rates? Would the declaration ‘Simple Interest is interest earned on interest’ be True or False? How long would it try to get 40.00 on 8-percent interest with 2.00? That depends upon how the interest works.
Is it simple interest? Could it be compound interest? If compound, then how often is it compounded? 40 in 237.5 years. 8% substance interest, compounded quarterly, does the working job in 37.8 years. As you can see, it makes a difference quite. How do banks calculate simple interest?
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But bank or investment company interest is always compounded, simple never. What’s the monthly interest rate of 18 percent annually? With simple interest, it is 1.5% per month. If compounded, it is 1.389% approx. What’s 3 percent of 100.00 per annum for 6 years? 18 in 6 years. What are the simple interest paid on 3000 pounds at 3.5 percent annually after 5 years and how much if the interest was compounded showing work for both answers?
That depends upon me it simple interest or substance interest. If compound, then it also depends on how often interest is compounded. 3,960.46. You can see a difference is manufactured by it. Exactly what will 10000 be worth after 5 years at 5 percent? It creates a difference in the way the interest is compounded often, and you also haven’t considered that information. Whether it’s compounded annually, then your 10,000 becomes 12,762.82 after 5 years.
If it’s compounded quarterly, it thenbecomes 12,820.37. Whether it’s compounded “daily”, then it becomes 12,840.03. Whether it’s “simple” (uncompounded) interest, then 10,000 swells to full 12,500 in 5 years. The principles of simple interest and compound interest and how these affected the results of your investment exercise? It depends upon whether the 4% interest is per annum or for 8 years altogether.