Compound interest uses the accumulated balance-principal plus interest to date-at each year-end to compute interest in the succeeding year.

Name: Compound interest uses the accumulated balance-principal plus interest to date-at each year-end to compute interest in the succeeding year.
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Question

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Compound interest calculates interest on the initial principal and also on the accumulated interest from previous periods, leading to interest being calculated on an increasing balance each year.

Compound Interest Uses the Accumulated Balance-Principal Plus Interest to Date-At