Harold deposits $100 a month into a savings account. His bank informs him that
his account has changed from earning interest compounded quarterly to interest
compounded weekly. Is this good news for Harold? Justify your answer

Question

Harold deposits $100 a month into a savings account. His bank informs him that 
his account has changed from earning interest compounded quarterly to interest 
compounded weekly. Is this good news for Harold? Justify your answer

anonymous · Answer

Yes. Because interest (interest * principal) is added to the principal ($100) at a weekly rate, rather than every quarter. Hence, more money is being "compounded".