"Compounded annually" means that the interest is added once a year.
Annually means once a year, so 1 time.
Once.
Four.
It would be worth 428.24 if the interest was added on once each year. If the interest were to be compounded monthly rather than annually the value would be 447.67
The concept is that at the end of each time interval, the interest for that period is added to the principal. As a reult, the interest for any period is calculated not only on the principal but also the interest from previous periods.
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If the interest is compounded annually, then the first interest payment isn't added until the end of the first year. Until then, the investment is worth exactly $15,000.00 .
In terms of economics, compounded interest means the interest earned from the principal and added interest. In many cases, this method is always used by some internet scammers to lure people to invest.
Assuming interest is added at the end of the year, the future value is 13,710.59
It would be worth 428.24 if the interest was added on once each year. If the interest were to be compounded monthly rather than annually the value would be 447.67
Interest is compounded semiannually if the interest is calculated every six months and added to the capital.
Compounded means when something, like interest or growth, is added to the principal amount and then calculated on the new total. This results in exponential growth over time.