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Sam is 14 years old and likes to hide in his treehouse to watch his neighbor change her clothes at the end of the day. Which of the following would be TRUE for Sam?
Continuously Compounded Interest
Interest calculated on the initial principal and also on the accumulated interest of previous periods of a deposit or loan.
Simple Interest
Interest earned only on the original principal amount invested.
Annually Compounded Interest
Interest on a loan or investment that is calculated once a year, adding the interest to the principal sum and basing future interest calculations on this new principal.
Amortized Daily Interest
Interest on a loan computed each day using the balance of the loan on that day, leading to a variable interest charge per billing period.
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