By definition, a bank that pays simple interest on a savings account will pay interest:
A)only at the beginning of the investment period.
B)on interest.
C)only on the principal amount originally invested.
D)on both the principal amount and the reinvested interest.
E)only if all previous interest payments are reinvested.

Question

Quizplus · Accepted Answer

Simple interest is calculated only on the principal amount originally invested, not on any accumulated interest.

By Definition, a Bank That Pays Simple Interest on a Savings