The add-on method is less expensive than the simple interest method when the stated rates of interest are identical.

Name: The add-on method is less expensive than the simple interest method when the stated rates of interest are identical.
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Quizplus · Accepted Answer

The add-on method tends to be more expensive than the simple interest method because interest is calculated on the original loan amount for the entire loan period, without considering the decreasing principal balance over time.

The Add-On Method Is Less Expensive Than the Simple Interest