How many times will interest be added to the principal in 1 year if the interest is compounded annually?

A. 12
B. 6
C. 2
D. 1

Question

How many times will interest be added to the principal in 1 year if the interest is compounded annually?

 		A.	12
 		B.	6
 		C.	2
 		D.	1

e.mccormick · Answer

An example of something that happens annually is your birthday.

anonymous · Answer

so 1 @e.mccormick

e.mccormick · Answer

Yep.  If it compounds monthly, then every month, 12 months in a year.  bimonthly, well, every other month, so 12/2 = 6.  semi annually or biannually is 2x a year.

bimonthly and biannually are things that can be confusing because they can mean "twice a" or "every two" with the same word.  So they are the only ones to be careful with.

anonymous · Answer

omg thank you so much  @e.mccormick

e.mccormick · Answer

np.  Hope you can see how those work so you can understand the terms when your class uses them again.

anonymous · Answer

i will thanks @e.mccormick