BUSINESS ADMINISTRATION
BUSINESS MATHEMATICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Coupon
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Interest (I)
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Simple Interest
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Compound Interest
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Detailed explanation-1: -Simple interest is calculated on the principal, or original, amount of a loan. Compound interest is calculated on the principal amount and the accumulated interest of previous periods, and thus can be regarded as “interest on interest.”
Detailed explanation-2: -Simple interest is based on the principal amount of a loan or deposit. In contrast, compound interest is based on the principal amount and the interest that accumulates on it in every period.
Detailed explanation-3: -3. is computed on the principal and on the accumulated past interests called compound interest.
Detailed explanation-4: -This is also known as compound interest, or compounding. Compound interest grows at a faster rate than basic interest, and it will be fastest when compounding periods are most frequent.
Detailed explanation-5: -Compound interest, Compound interest is computed on the principal and on any interest earned that has not been paid or withdrawn.