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-Why does the money in a savings account grow?

It earns interest, plus it earns interest on the interest.
A bank manager invests the money in the stock market.
The federal government matches your deposit.
You don’t pay taxes on it.

User Flyclassic
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2 Answers

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A) It earns interest, plus it earns interest on the interest.

User Seanna
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3 votes

Answer:

The correct answer is letter "A": It earns interest, plus it earns interest on the interest.

Step-by-step explanation:

In banking, the money individuals save in their accounts is used by the financial institutions in different investment instruments being the most basic lending those sources to other individuals or institutions. Account-holders, though, benefit from the interest rate set at the moment of selecting their bank accounts. If a compounded interest rate was chosen, the account holder will get interest over the interest that the bank computes periodically.

User Daniel Ashton
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