The term interest-on-interest refers to:
A) The payment of interest more than once per year.
B) The interest earned on previous interest earnings which were reinvested.
C) Earning interest on an investment for a period greater than one year.
D) Earning interest only on the principal amount invested.
E) The process of accumulating interest on an investment over time to earn more interest.

Question

Quizplus · Accepted Answer

Interest-on-interest refers to the interest earned on previously earned interest that has been reinvested, leading to compound growth.

The Term Interest-On-Interest Refers To