Difference between revisions of "Simple interest"
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'''Simple Interest''' is when any interest received only takes into account the principle amount and so the amount of interest will not increase over time. An example would be a $1,000 account that pays 4% simple interest would yield $40 per year each year. That amount would not change unless more money would be added to the account or money would be withdrawn from the account. | '''Simple Interest''' is when any interest received only takes into account the principle amount and so the amount of interest will not increase over time. An example would be a $1,000 account that pays 4% simple interest would yield $40 per year each year. That amount would not change unless more money would be added to the account or money would be withdrawn from the account. | ||
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| + | == See Also == | ||
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| + | * [[Compound interest]] | ||
[[Category: Economics]] | [[Category: Economics]] | ||
Revision as of 19:08, September 29, 2007
Simple Interest is when any interest received only takes into account the principle amount and so the amount of interest will not increase over time. An example would be a $1,000 account that pays 4% simple interest would yield $40 per year each year. That amount would not change unless more money would be added to the account or money would be withdrawn from the account.
