Compound interest is a very important concept when evaluating the return on an investment you plan to hold for a long time.

Question

Quizplus · Accepted Answer

Compound interest is a powerful force that allows investors to earn interest not only on the initial investment, but also on the interest earned in previous periods. This results in exponential growth of the investment and can significantly increase the return over time. Therefore, it is crucial to consider compound interest when evaluating investment options for long-term holdings.

Compound Interest Is a Very Important Concept When Evaluating the Return