A savings account that compounds interest daily will earn a higher return than a savings account that pays simple interest daily. True or false

The simple interest daily pay doesn't grow with time, while your daily compound interest, albeit small, will grow with time and eventually yield a higher return.

For example if you deposit $1000 into your saving account and the simple interest gains you $1 a day, after 100 days you would have

$1000 + $1 * 100 = $1100

However, with compound interest at 0.1% rate daily. After 100 days you would have

$1000 * 1.001^100 = $1105.12

So compound interest gives higher return

andromache andromache · Answer 2 · 2022-02-01T13:23:17+01:00

andromache andromache

01-02-2022

The given statement is True

The following information should be considered:

The simple interest should not daily grow with time, while your daily compound interest will grow with time and eventually yield a higher return.
Due to this, the compound interest gives higher return

Learn more: https://brainly.com/question/7695753?referrer=searchResults

Answer Link