When the amount earned on a deposit has become part of the principal at the end of a specified time period the concept is called
A)discount interest.
B)compound interest.
C)primary interest.
D)future value.

Question

Quizplus · Accepted Answer

Compound interest is the concept where the interest earned on a deposit is added back to the principal at the end of a specified time period, and then interest is earned on both the principal and the interest. This can lead to significant growth in the value of the deposit over time. Discount interest refers to a situation where interest is subtracted from the principal up front, while primary interest and future value are not relevant concepts in this context.

When the Amount Earned on a Deposit Has Become Part