Compound interest assumes that all interest earned will remain invested and earn additional interest at the same interest rate.

Name: Compound interest assumes that all interest earned will remain invested and earn additional interest at the same interest rate.
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Question

Quizplus · Accepted Answer

Compound interest is calculated on the principal amount, as well as the accumulated interest. Therefore, the interest earned is reinvested, and it continues to earn interest for every period until withdrawal.

Compound Interest Assumes That All Interest Earned Will Remain Invested