ECONOMICS
COMPOUND INTEREST
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
The compound interest formula is:A = P(1 + r) t What does the A represent?
|
|
The amount of interest earned.
|
|
|
The amount of time that has passed.
|
|
|
The total amount of money after a certain amount of time.
|
|
|
The amount required to invest.
|
Explanation:
Detailed explanation-1: -A represents the new principal sum or the total amount of money after compounding period.
Detailed explanation-2: -Compound interest, can be calculated using the formula FV = P*(1+R/N)^(N*T), where FV is the future value of the loan or investment, P is the initial principal amount, R is the annual interest rate, N represents the number of times interest is compounded per year, and T represents time in years.
Detailed explanation-3: -It is governed by the formula: I = Prt. where I is the amount of interest, P is the principal (amount of money borrowed), r is the interest rate (per year), and t is the time (expressed in years).
There is 1 question to complete.