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14 February, 12:09

If you are borrowing money and paying interest would you prefer an interest rate that compounds annually quarterly or daily

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  1. 14 February, 13:50
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    Interest rate because if you do daily yes you will have more money at the time but I interest will add up over time and you will double the amount then a daily
  2. 14 February, 14:32
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    As the borrower, you would prefer an interest rate does not compound, because this minimizes interest earned; ie: a simple interest rate.

    As a lender, among the three options presented, you would prefer an interest rate that compounds daily because this maximizes interest earned.
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