The more frequent the compounding periods in a year,the higher the future value.

Name: The more frequent the compounding periods in a year,the higher the future value.
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Quizplus · Accepted Answer

This is because compounding allows for interest earned in each period to be added to the principal, resulting in a larger base for the next period's interest calculation. The more frequently this process occurs, the more opportunities there are for compounding and the higher the final future value.

The More Frequent the Compounding Periods in a Year,the Higher