week 2 - reading material Flashcards
1
Q
A dollar today is worth more than a dollar in the future?
T/F
A
T
2
Q
what does future value means?
A
The amount of money an investment will grow to over some period of time at some given interest rate.
3
Q
what compounding interest is?
A
Compounding the interest means earning interest on interest , so we call the result compound interest . It different from simple interest because with simple interest , the interest is not reinvested, so interest is earned each period only on the original principal
