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In a short essay, compare specific plans and directional plans.
Compound Interest
This refers to the calculation of interest on the beginning balance of a loan or deposit, adding in the interest that has built up over time from prior periods.
Present Value
The value as of now of a future amount of money or subsequent cash flows, based on a chosen return rate.
Compound Interest
Interest that is determined by taking into account not only the original principal of a deposit or loan but also all the interest that has been compounded in previous cycles.
Earnings Rate
The return on an investment or the amount of profit made compared to the amount of money invested.
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