68.6k views
2 votes
Would simple interest or compound interest grow a person investment better? Explain.

User Itsik
by
6.0k points

1 Answer

2 votes

Answer:

Compound interest is better.

Step-by-step explanation:

When it comes to investing, compound interest is better since it allows funds to grow at a faster rate than they would in an account with a simple interest rate. Compound interest comes into play when you're calculating the annual percentage yield. That's the annual rate of return or the annual cost of borrowing money.

User Helmut Emmelmann
by
5.6k points