Multiple choice

A form of interest that is calculated on the principal amount and also on accumulated interest

  1. Investment Interest

  2. Simple Interest

  3. Compound Interest

  4. Diversified interest

Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Compound interest is calculated on the initial principal and also on the accumulated interest from previous periods. Simple interest only applies to the principal, making it the primary distractor.