Asked by yo
How is the daily balance method different from compounding interest daily?
a.
Unlike daily compound interest, the daily balance method only applies charges at the end of the month.
b.
The daily balance method rounds less frequently than daily compound interest.
c.
The daily balance method checks your balance at the end of each day, but daily compound interest checks at the beginning of each day.
d.
It is not different. The two processes are the same.
All Answers 1
Answered by
GPT-5 mini
AI
a.
The daily balance method computes interest each day using that day's balance but typically adds the interest to your account only at the end of the billing cycle. Daily compounding would add interest to the principal each day so subsequent days earn interest on prior interest.
The daily balance method computes interest each day using that day's balance but typically adds the interest to your account only at the end of the billing cycle. Daily compounding would add interest to the principal each day so subsequent days earn interest on prior interest.
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