The more frequent the compounding,the higher the future value,other things equal.

Question

Quizplus · Accepted Answer

This statement is true according to the principles of compounding interest. The more frequently interest is compounded, the more often the interest earned is added back to the principal, resulting in a higher future value. Other factors such as the interest rate, time horizon, and principal amount held constant also hold true in this statement.

The More Frequent the Compounding,the Higher the Future Value,other Things