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Which descriptions about simple interest and yearly compounded interest are true? Check all that apply.

~Only compound interest has an exponent in its formula.

~Simple interest is earned on principal and interest.

~Compound interest earns more money than simple interest at the same rate for the same amount of time.

~Simple interest earns more money than compound interest at the same rate for the same amount of time.

~Simple interest is only earned on the original principal investment.

~Only compound interest earns the same interest amount every year.

~Only simple interest uses time in its formula.

~Compound interest is earned on principal and interest.

Verified Answer :

ayfat23

Answer:

Step-by-step explanation:

ONLY THE "TRUE" OPTIONS ARE LISTED BELOW

1.)Only compound interest has an exponent in its formula(TRUE)

((P*(1+i)^n) - P),

where P is the principal, i is the annual interest rate, and

n is the number of periods which is the exponential

2.)Compound interest earns more money than simple interest at the same rate for the same amount of time.(TRUE)

This is true because compound interest encompass simple interest in it's formula

3.)Simple interest is only earned on the original principal investment. (TRUE)

4.)Compound interest is earned on principal and interest.( TRUE)

Compound interest increases exponentially and has more value than simple interest at the same time period and principal. The statements first, second, and third are correct.

What is the simple and compound interest?

Interest is the cost of borrowing money. Typically expressed as a percentage. Whereas compound interest is the interest on a loan calculated based on the initial principal.

1.  Only compound interest has an exponent in its formula. So yes, Only compound interest has an exponent in its formula.

2.  Simple interest is earned on principal and interest. So yes, Simple interest is earned on principal and interest.

3.  Compound interest earns more money than simple interest at the same rate for the same amount of time. So yes, Compound interest earns more money than simple interest at the same rate for the same amount of time.

4.  No, Simple interest earns more money than compound interest at the same rate for the same amount of time.

5.  No, compound interest earns the same interest amount every year.

6.  No, compound interest also uses time in its formula.

7.  No, time is also needed for the calculation.

Thus, statements 1, 2, 3 are true and the rest are false.

More about the Simple and Compound interest link is given below.

https://brainly.com/question/7420113

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