Adding Interest to the Principal and Paying Interest on the New

question 38

Multiple Choice

Adding interest to the principal and paying interest on the new total is called paying

• A)compound interest.
• B)simple interest.
• C) semiannual interest.
• D) total interest.

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Definitions:

Borrowing Funds

The act of obtaining money from another party, typically a financial institution, under the agreement to repay it, often with interest, at a later date.

Bringing in Partners

The process of adding one or more individuals as business partners, typically to share ownership, responsibilities, and benefits of operating a business.

Sole Proprietorship

A business owned and operated by a single individual, where there is no legal distinction between the owner and the business.

Federal Trade Commission's Franchise Rule

A regulation issued by the FTC that requires franchisors to provide detailed disclosures to potential franchisees, to ensure they have the necessary information before investing.