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Simple interest is paid oniy on the

1 Answer

5 votes

Answer:

Principal amount only

Step-by-step explanation:

Simple interest is calculated based on the principal amount borrowed or the principal deposit. If the principal amount does not change, the simple interest earned will remain a constant figure through the loan or deposit life. Simple interest does not increase or decrease the principal amount.

Simple interest contrast with compound interest that adds interest earned to the principal amount at the end of a season.

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