Ask Question
29 May, 17:42

Michelle invests her money in an account earning simple interest. What can she expect to happen to the balance of her account.

+2
Answers (1)
  1. 29 May, 18:44
    0
    She can expect a linear growth (slow but steady) in her investment. Michelle's interest in a simple interest investment is the amount she accrued on deposits with a certain interest rate. It is based on the original sum of money known as the "principal" which she invested. When someone make a payment on a simple interest loan, the payment goes through that month's interest, and the remainder goes toward the principal. Each month's interest is paid in full so it never accrues - - compounding doesn't occur. There is a big difference in the amount of interest payable on a loan if interest is calculated on a compound rather than on a simple basis which is what simple interest entails and this is why simple interest doesn't accrue as much as compounding your interest since the Interest is calculated only on the principal amount.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Michelle invests her money in an account earning simple interest. What can she expect to happen to the balance of her account. ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers