Match each of the following terms related to interest and time value of money calculations to their appropriate definition.
-Interest that is earned or paid on the principal amount only.
A)Time value of money
B)Simple interest
C)Compound interest
D)Future value of a single amount
E)Present value of a single amount
F)Annuity
G)Future value of an annuity
H)Present value of an annuity

Question

Quizplus · Accepted Answer

Simple interest is calculated on the principal amount only, not on the interest that has been added to this principal over time.

Match Each of the Following Terms Related to Interest and Time