What refers to the amount of money paid for the use of borrowed capital? A. Interest B. Rate of interest C. Simple interest D. Principal

Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter19: The Basic Tools Of Finance
Section: Chapter Questions
Problem 1CQQ
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What refers to the amount of money paid for the use of borrowed
capital?
A. Interest
B. Rate of interest
C. Simple interest
D. Principal
If an initial investment of $1,000 is invested at 8% interest per year
with annual compounding, how much would be in the account
after five years?
A. $1,201.8
B. $1,471.6
C. $1,091.8
D. $1,080.0
Transcribed Image Text:What refers to the amount of money paid for the use of borrowed capital? A. Interest B. Rate of interest C. Simple interest D. Principal If an initial investment of $1,000 is invested at 8% interest per year with annual compounding, how much would be in the account after five years? A. $1,201.8 B. $1,471.6 C. $1,091.8 D. $1,080.0
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