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Compound interest is paid on the principle amount, the amount deposited, and on interest you earn.
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True.
Compound interest is interest computed on the original principal and on interest that has been added to the account. (In formula form: A = P(1 + r/n)^{nt}.) For example, $100 at 10% annually yields $10 in year 1, then $11 interest in year 2 because interest is paid on the new amount $110.
Compound interest is interest computed on the original principal and on interest that has been added to the account. (In formula form: A = P(1 + r/n)^{nt}.) For example, $100 at 10% annually yields $10 in year 1, then $11 interest in year 2 because interest is paid on the new amount $110.
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