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Explain to the client the main differences between simple interest versus compound interest.
Simple vs compound interest is not hard to understand Basically, simple interest is interest paid on the original principal only For example,4000 dollars is deposited into a bank account and the annual interest rate is 8%. [ However, coumpound interest is the interest earned not only on the original principal, but also on all interests earned previously In other words, at the end of each
year, the interest earned is added to the original amount and the money is reinvested ]
Expert answered|AwesomeGuy200|Points 1062|
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Asked 6/26/2012 3:25:52 PM
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