Compound Interest Is the Return on Principal

question 1

Multiple Choice

Compound interest is the return on principal:

• A) only.
• B) for one or more periods.
• C) plus interest or two or more periods.
• D) for one period.

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Definitions:

Reliance Interest

Refers to the compensation aimed at putting a party in the position they would have been in had a contractual promise not been made.

Concurrent Condition

A situation in contract law where the obligations of parties are to be performed at the same time; the performance of one party is conditioned upon the performance by the other.

Constructive Condition

A condition inferred by law from the conduct of parties or the circumstances, rather than explicitly stated in a contract.

Materiality

A principle in accounting and law that concerns the significance of an event, fact, or item in the context of decision-making or reporting.