--%>

Explain compound interest

Explain compound interest? Compare compound interest to discounting.

Compound interest takes place while interest is earned on interest and on the original principal of an investment. Discounting is the opposite process of compounding. Compound interest is reason of the value of a starting amount to rise at an increasing rate. Discounting causes the present value of a future amount to reduce at an increasing rate.

   Related Questions in Finance Basics

  • Q : Shares Assignment Mina Patel has seen

    Assignment Mina Patel has seen attractive advertisements for Dixons Retail plc and its UK-based brands. She is also aware of the intense competition between retailers of electronic and electrical goods, at a time of global economic uncertainty. Mina has recently inherited several thousand pound

  • Q : For banking services how competitive is

    For banking services how competitive is the market?Along with more than 7,000 banks and thrifts in the U.S., banking is one of the most competitive industries in the world. Assume the following characteristics of the American financial services

  • Q : Explain LBO-risks for equity investors

    Explain LBO? Describe risks for the equity investors and also describe potential rewards? A leveraged buyout is purchase of publicly owned corporation through a small group of investors by using a large amount of borrowed money. The risks for

  • Q : What is Enrolled Bill Report Enrolled

    Enrolled Bill Report (EBR): The analysis prepared on Legislative measures passed by both houses and passed on to the Governor, to give the Governor’s Office with information relating to the measure with a recommendation for action by the Governo

  • Q : Describe advantages and the

    Describe advantages and the disadvantages of new stock issue? A new stock issue increase funds and decreases the riskiness of the firm. This also tends to send a negative signal to the market as many investors believe a company would just sell

  • Q : What are Staff Benefits Staff Benefits

    Staff Benefits: It is an object of expenditure symbolizing the state costs of contributions for employee’s retirement, health benefits, OASDI, and non-industrial disability leave advantages.

  • Q : What is Out-of-State Travel blanket

    Out-of-State Travel (OST) blanket: The request by a state agency for Governor’s Office approval of the proposed out-of-state trips to be taken by that agency’s personnel throughout the fiscal year.

  • Q : What is a Provision Provision : The

    Provision: The language in a bill or act which imposes necessities or constraints on actions or expenditures of the state. The provisions are frequently employed to constrain the expenditure of appropriations however it might also be employed to give

  • Q : Growth rate of its real GDP Normal 0

    Normal 0 false false

  • Q : Explain compound interest Normal 0

    Normal 0 false false