ECONOMICS
SAVING AND INVESTING
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]


owner of the account


primary investor in the account.


original amount of money deposited for investing


amount of money paid out of the earnings.

Detailed explanation1: Principal is also the original amount of investment made in an asset, separate from any earnings or interest accrued. For example, assume you deposit $5, 000 in an interestbearing savings account. At the end of 10 years, your account balance will have grown to $6, 500.
Detailed explanation2: The principal is the total amount borrowed from a lender or the initial amount invested. In other words, it is the original sum of money that has been borrowed or invested.
Detailed explanation3: Your principal is money in your possession that can earn interest or dividends.
Detailed explanation4: 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 explanation5: Interest: Is the amount of money paid or earned for the use of someone else’s money (loan). A bank or other financial institution is usually who will pay out or receive the interest. SIMPLE INTEREST: Interest paid only on the initial principal of a savings account or loan.